Document:

Exhibit 4.1

SUBORDINATED NOTE CERTIFICATE

 

PINNACLE BANK

Fixed-to-Floating Rate Subordinated Notes Due 2025

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE "FDIC") OR ANY OTHER GOVERNMENT AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS SUBORDINATED AND JUNIOR IN RIGHT OF PAYMENT TO THE OBLIGATIONS OF PINNACLE BANK (THE "BANK") TO ITS GENERAL AND SECURED CREDITORS (TO THE EXTENT OF SUCH SECURITY), TO DEPOSITS AND LIABILITIES OF THE BANK (OTHER THAN EXISTING SUBORDINATED DEBT) AND IS UNSECURED AND INELIGIBLE AS COLLATERAL FOR A LOAN BY THE BANK OR ANY OF ITS SUBSIDIARIES.

EACH SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF $1,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF A SUBORDINATED NOTE IN A DENOMINATION OF LESS THAN $1,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER AND MAY BE DISREGARDED BY THE BANK OR ANY OF ITS AGENTS. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH SUBORDINATED NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PAYMENTS ON SUCH SUBORDINATED NOTE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH SUBORDINATED NOTE.

THIS IS A GLOBAL NOTE WITHIN THE MEANING OF SECTION 2 OF THE ISSUING AND PAYING AGENCY AGREEMENT.

UNLESS THIS GLOBAL NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE BANK OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATED NOTE ISSUED IN EXCHANGE FOR THIS NOTE OR ANY PORTION HEREOF IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) PURSUANT TO AND IN ACCORDANCE WITH THE ISSUING AND PAYING AGENCY AGREEMENT, ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON OTHER THAN DTC OR A NOMINEE THEREOF IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAWS AND WAS OFFERED PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY SECTION 3(A)(2) OF THE SECURITIES ACT. THE BANK HAS NOT ENTERED INTO AN INDENTURE IN CONNECTION WITH THE ISSUANCE OF THIS SECURITY. EACH PURCHASER OF A BENEFICIAL INTEREST IN THIS SECURITY, IN MAKING ITS PURCHASE, WILL BE DEEMED TO HAVE REPRESENTED AND WARRANTED TO THE BANK THAT IT IS AN INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR AS DEFINED IN REGULATION D UNDER THE SECURITIES ACT OF 1933 (AN "INSTITUTIONAL ACCREDITED INVESTOR"), THAT IT IS PURCHASING SUCH INTEREST FOR ITS OWN ACCOUNT OR THE ACCOUNT OF ANOTHER INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR AND THAT FOLLOWING SUCH PURCHASE IT OR SUCH OTHER INSTITUTIONAL ACCREDITED INVESTOR HOLDING A BENEFICIAL INTEREST IN THIS SECURITY WILL HOLD A BENEFICIAL INTEREST IN A PRINCIPAL AMOUNT OF $100,000 OR AN INTEGRAL MULTIPLE OF $1,000 IN EXCESS THEREOF AT ALL TIMES.

NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, (1) THE BANK SHALL NOT PAY ANY INTEREST ON THIS NOTE WHILE IT REMAINS IN DEFAULT IN THE PAYMENT OF ANY ASSESSMENT TO THE FDIC IF PAYMENT OF SUCH INTEREST WOULD THEN BE PROHIBITED BY 12 U.S.C. SECTION 1828(B) (OR ANY SUCCESSOR STATUTE), AND (2) IF THE BANK BECOMES A CRITICALLY UNDERCAPITALIZED DEPOSITORY INSTITUTION, THE BANK SHALL NOT MAKE ANY PAYMENTS OF PRINCIPAL OR INTEREST ON THIS NOTE IF THE BANK WOULD THEN BE PROHIBITED FROM MAKING ANY SUCH PAYMENTS BY 12 U.S.C. SECTION 1831O (OR ANY SUCCESSOR STATUTE), PROVIDED, IN EACH CASE, (A) INTEREST SHALL CONTINUE TO ACCRUE ON THIS NOTE, AND (B) THE BANK SHALL NOT BE RELIEVED FROM MAKING SUCH PAYMENTS OF PRINCIPAL OR INTEREST ON THIS NOTE WHEN PERMITTED BY APPLICABLE LAW.

 

NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, FOR SO LONG AS THE BANK IS AN INSURED, STATE NONMEMBER BANK, RETIREMENT, REDEMPTION OR PREPAYMENT OF THIS NOTE IS SUBJECT TO THE PROVISIONS OF SECTION 18(I)(1) OF THE FEDERAL DEPOSIT INSURANCE ACT, 12 U.S.C. SECTION 18(I)(1), REQUIRING THAT NO SUCH BANK SHALL REDUCE THE AMOUNT OR RETIRE ANY PART OF ITS COMMON OR PREFERRED CAPITAL STOCK, OR RETIRE ANY PART OF ITS CAPITAL NOTES OR DEBENTURES WITHOUT THE PRIOR WRITTEN CONSENT OF THE FDIC. THE FDIC HAS NOT GIVEN ANY CONSENT TO RETIREMENT, REDEMPTION OR PREPAYMENT OF THIS NOTE, AND ANY RETIREMENT, REDEMPTION OR PREPAYMENT OF ALL OR PART OF THE PRINCIPAL AMOUNT OF THIS NOTE, INCLUDING THE PAYMENT BY THE BANK OF THE PRINCIPAL AMOUNT OF THIS NOTE WHEN DUE AND PAYABLE AT THE MATURITY HEREOF, WHETHER BY VOLUNTARY OR INVOLUNTARY PAYMENT OR BY ANY OTHER PAYMENT, UPON ACCELERATION OF THE MATURITY OF THIS NOTE IN ACCORDANCE WITH SECTION 6 HEREOF, OR OTHERWISE, INCLUDING BY MEANS OF BANKER'S LIEN, SETOFF, OFFSET OR SIMILAR LEGAL OR EQUITABLE RIGHTS, BY APPLICATION OF ANY PROPERTY OR OTHER ASSETS OF THE BANK TO THE PAYMENT, REALIZATION UPON, PURCHASE, OR OTHER ACQUISITION OF THIS NOTE, OR IN ANY OTHER WAY, IS SUBJECT TO THE SPECIFIC PRIOR WRITTEN CONSENT OF THE FDIC. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, EACH HOLDER OF THIS NOTE WHICH IS A DEPOSITORY INSTITUTION (REGARDLESS OF WHERE CHARTERED AND WHETHER OR NOT INSURED BY THE FDIC) EXPRESSLY WAIVES ANY RIGHT OF BANKER'S LIEN, SETOFF, OFFSET, OR SIMILAR LEGAL OR EQUITABLE RIGHT, WHICH SAID HOLDER MAY OTHERWISE HAVE UNDER ANY APPLICABLE PROVISIONS OF STATUTORY OR COMMON LAWS.

 

2

	
Registered No. 2

	
Principal Amount:

	
$70,000,000

	 	 	 
	 	
CUSIP:

	
72345HAA3

PINNACLE BANK

Fixed-to-Floating Rate Subordinated Notes Due 2025

1.            Payment.

(a)            PINNACLE BANK, a Tennessee-chartered commercial bank (the "Issuer"), for value received, hereby promises to pay to Cede & Co., or registered assigns, as nominee of DTC, the principal sum of Seventy Million Dollars (U.S.) ($70,000,000) on July 30, 2025 (the "Maturity Date") and to pay interest thereon (i) at the rate of 4.875% per year (computed on the basis of a 360-day year of twelve 30-day months) from and including January 30, 2016 to but excluding July 30, 2020 or any early redemption date (the "Fixed Rate Interest Period"), payable during the Fixed Rate Interest Period semi-annually in arrears, on January 30 and July 30 of each year (each, a "Fixed Interest Payment Date"), and (ii) at the rate per annum equal to the three-month LIBOR rate plus 312.8 basis points (3.128%) (computed on the basis of a 360-day year based on the number of days actually elapsed) from and including July 30, 2020 to the Maturity Date or any early redemption date (the "Floating Rate Interest Period"), payable quarterly in arrears on each January 30, April 30, July 30 and October 30 (each, a "Floating Interest Payment Date" and together with each Fixed Interest Payment Date, the "Interest Payment Dates"). The first Interest Payment Date shall be July 30, 2016.

(b)            If any Interest Payment Date or the Maturity Date or early redemption date is not a Business Day, then the payment will be made on the next succeeding Business Day and no interest will accrue as a result of such postponement.  A "Business Day" means any day other than a Saturday, Sunday, federal holiday or day on which banks in the State of New York are authorized or obligated by law or executive order to close.

(c)            For purposes hereof:

(i)            "Determination Date" with respect to an Interest Period will be the second London Banking Day preceding the first day of such Interest Period.

(ii)            "Interest Period" means the period commencing on and including an Interest Payment Date and ending on and including the day immediately preceding the next succeeding Interest Payment Date.

(iii)            "LIBOR" with respect to an Interest Period, will be the ICE Benchmark Administration London Interbank Offered Rate (expressed as a percentage per annum) for deposits in U.S. dollars for a three-month period beginning on the second London Banking Day after the Determination Date that appears on the appropriate page of the Reuters Screen as of 11:00 a.m., London time, on the Determination Date.  If such screen does not include such a rate or is unavailable on a Determination Date, the Issuing and Paying Agent will request the principal London office of each of four major banks in the London interbank market, as selected by the Issuing and Paying Agent, to provide such bank's offered quotation (expressed as a percentage per annum), as of approximately 11:00 a.m., London time, on such Determination Date, to prime banks in the London interbank market for deposits in a Representative Amount in U.S. dollars for a three-month period beginning on the second London Banking Day after the Determination Date.  If at least two such offered quotations are so provided, the rate for the Interest Period will be the arithmetic mean of such quotations.  If fewer than two such quotations are so provided, the Issuing and Paying Agent will request each of three major banks in New York City, as selected by the Issuing and Paying Agent, to provide such bank's rate (expressed as a percentage per annum), as of approximately 11:00 a.m., New York City time, on such Determination Date, for loans in a Representative Amount in U.S. dollars to leading European banks for a three-month period beginning on the second London Banking Day after the Determination Date.  If at least two such rates are so provided, the rate for the Interest Period will be the arithmetic mean of such rates.  If fewer than two such rates are so provided, then the rate for the Interest Period will be the rate in effect with respect to the immediately preceding Interest Period.

(iv)            "London Banking Day" is any day on which dealings in U.S. dollars are transacted or, with respect to any future date, are expected to be transacted in the London interbank market.

(v)             "Representative Amount" means a principal amount of not less than $1,000,000 for a single transaction in the relevant market at the relevant time.

3

2.            Subordinated Notes, Noteholders.  This Subordinated Note is a duly authorized issue of notes of the Issuer designated as Fixed-to-Floating Rate Subordinated Notes Due 2025 (herein called the "Subordinated Notes" or the "Notes") issued under the Issuing and Paying Agency Agreement, dated as of July 30, 2015 (the "Issuing and Paying Agency Agreement"), by and between the Issuer and U.S. Bank National Association, as Issuing and Paying Agent (herein called the "Issuing and Paying Agent," which term includes any successor issuing and paying agent under the Issuing and Paying Agency Agreement) and reference is hereby made to the Issuing and Paying Agency Agreement for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Issuer and the Issuing and Paying Agent and of the terms upon which the Subordinated Notes are, and are to be, authenticated and delivered.  The holder in whose name any Subordinated Notes are registered on the Security Register (as defined herein) is referred to as a "Noteholder," and such holders collectively are referred to as the "Noteholders."

3.            Optional Redemption.  The Issuer may, at its option, beginning with the Interest Payment Date of July 30, 2020 and on any scheduled Interest Payment Date thereafter (or at any time on or after the 30th day prior to the Maturity Date), redeem the Subordinated Notes in whole or in part at a redemption price equal to 100% of the principal amount of the redeemed Subordinated Notes, plus accrued and unpaid interest to the date of the redemption. The option of redemption pursuant to this paragraph is subject to the approval of the Federal Deposit Insurance Corporation (the "FDIC").

The Issuer will notify Noteholders of the Subordinated Notes to be redeemed at least 30 but not more than 60 days before the scheduled redemption (which notice may be conditional).  If the Issuer is redeeming less than all the Subordinated Notes, the Issuing and Paying Agent under the Issuing and Paying Agency Agreement must select the Subordinated Notes to be redeemed by lot or by such other method as the Issuing and Paying Agent deems fair and appropriate, subject to the rules and procedures of DTC.

Additionally, any time the Subordinated Notes remain outstanding, the Subordinated Notes are redeemable by the Issuer in whole, but not in part, on not fewer than 30 nor greater than 60 days' prior notice, subject to the FDIC's prior approval, to the extent then required, upon the occurrence of any of the following:

(i)            a "tax event," which means the receipt by the Issuer of an opinion of independent tax counsel to the effect that (a) an amendment to or change (including any announced prospective amendment or change) in any law or treaty, or any regulation thereunder, of the United States or any of its political subdivisions or taxing authorities, (b) a judicial decision, administrative action, official administrative pronouncement, ruling, regulatory procedure, regulation, notice or announcement, including any notice or announcement of intent to adopt or promulgate any ruling, regulatory procedure or regulation, (c) an amendment to or change in any official position with respect to, or any interpretation of, an administrative or judicial action or a law or regulation of the United States that differs from the previously generally accepted position or interpretation, or (d) a threatened challenge asserted in writing in connection with an audit of the Issuer's federal income tax returns or positions or a similar audit of any of the Issuer's, or its parent corporation's, subsidiaries or a publicly known threatened challenge asserted in writing against any other taxpayer that has raised capital through the issuance of securities that are substantially similar to the Notes, in each case, occurring or becoming publicly known on or after the date of the issuance of the Notes, resulting in more than an insubstantial risk that the interest payable on the Notes is not, or within 90 days of receipt of such opinion of tax counsel, will not be, deductible by the Issuer, in whole or in part, for U.S. federal income tax purposes;

(ii)            a "capital event," which means the Issuer makes a reasonable determination (as evidenced by an officers' certificate delivered to the Issuing and Paying Agent) that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws or any rules or regulations thereunder of the United States or any rules, guidelines or policies of an applicable regulatory authority for the Issuer or its parent corporation, or (b) any official or administrative pronouncement or action or judicial decision interpreting or applying such laws, rules or regulations, which amendment or change is effective or which pronouncement, action or decision is announced on or after the date of original issuance of the Subordinated Notes, it is reasonably likely that the Subordinated Notes will not be entitled to treatment as Tier 2 capital, the Subordinated Notes do not constitute, or within 90 days of the date of such opinion will not constitute, Tier 2 capital (or its then equivalent if the Issuer is subject to such capital requirement) for purposes of capital adequacy guidelines of the Federal Reserve Board of Governors or the FDIC (or any successor regulatory authority with jurisdiction over bank holding companies or their bank subsidiaries), as then in effect and applicable to the Issuer; or

 

4

(iii)            an "investment company event," which means the Issuer becoming required to register as an investment company pursuant to the Investment Company Act of 1940, as amended.

 

In the event of any such redemption, the redemption price shall be 100% of the aggregate principal amount of the Subordinated Notes being redeemed (plus accrued and unpaid interest through the early redemption date).

 

On and after any early redemption date, interest will cease to accrue on the Subordinated Notes called for redemption. On or prior to any early redemption date, the Issuer is required to deposit with the Issuing and Paying Agent money sufficient to pay the redemption price of and accrued interest on the Subordinated Notes to be redeemed on such date.

4.            Subordination.  The indebtedness of the Issuer evidenced by the Subordinated Notes, including the principal and interest on this Note, shall be subordinate and junior in right of payment to the prior payment in full of all existing and future Senior Indebtedness (as defined below) of the Issuer. The Noteholder of this Note hereby acknowledges and agrees that such subordination is for the benefit of and enforceable by the holders of such Senior Indebtedness.  Upon any payment or distribution of assets to creditors in case of the Issuer's liquidation, dissolution, winding up, reorganization, assignment for the benefit of creditors or any bankruptcy, insolvency, or similar proceedings, all holders of Senior Indebtedness will be entitled to receive payment in full of all amounts due to such holders pursuant to the terms of such Senior Indebtedness before the Noteholders will be entitled to receive any payment of principal or interest on their Subordinated Notes.  In the event of any such proceeding, after payment in full of all sums owing with respect to Senior Indebtedness, the Noteholders, together with the holders of any obligations of the Issuer ranking equally in right of payment with the Subordinated Notes, shall be entitled to be paid from the remaining assets of the Issuer, the unpaid principal thereof, and the unpaid interest thereon, before any payment or other distribution, whether in cash, property or otherwise, shall be made on account of any capital stock or any obligations of the Issuer that by its terms expressly ranks subordinate or junior to the Subordinated Notes.  In addition, no payment on account of principal or interest on the Subordinated Notes will be made by the Issuer if, at the time of such payment or immediately after giving effect thereto, there shall have occurred an event of default with respect to any of the Issuer's Senior Indebtedness, permitting the holders thereof (or a trustee on behalf of the holders thereof) to accelerate the maturity thereof, or an event that, with the giving of notice or the passage of time or both, would constitute such an event of default, and such event of default shall not have been cured or waived.

"Senior Indebtedness" means the principal of (and premium, if any) and interest, if any, on:

(a)            all of the Issuer's obligations for money borrowed (including deposits);

(b)            indebtedness of the Issuer evidenced by bonds, debentures, securities, notes or similar instruments;

(c)            obligations of the Issuer similar to those in Subsection 4(b) above arising from off-balance sheet guarantees and direct credit substitutes;

(d)            all obligations, contingent or otherwise, of the Issuer with respect to letters of credit, bankers' acceptances, security purchase facilities or similar facilities;

(e)            obligations of the Issuer issued or assumed as the deferred purchase price of property or services (but excluding trade accounts payable or accrued liabilities arising in the ordinary course of business);

(f)            capital lease obligations of the Issuer;

(g)            obligations of the Issuer associated with derivative products including but not limited to securities contracts, foreign currency exchange contracts, swap agreements (including interest rate and foreign exchange rate swap agreements), cap agreements, floor agreements, collar agreements, interest rate agreements, foreign exchange rate agreements, options, commodity futures contracts, commodity option contracts and similar financial instruments;

(h)            a deferred obligation of, or any such obligation, directly or indirectly guaranteed by, the Issuer which obligation is incurred in connection with the acquisition of any business, properties or assets not evidenced by a note or similar instrument given in connection therewith; and

(i)            debt of others described in the preceding clauses that the Issuer has guaranteed or for which the Issuer is otherwise liable or that is secured by a lien on any property or asset of the Issuer,

5

unless, in any case in the instrument creating or evidencing any such indebtedness or obligation, or pursuant to which the same is outstanding, it is expressly provided that such indebtedness or obligation is not superior in right of payment to the Subordinated Notes or to other debt that is pari passu with or subordinate to the Subordinated Notes.

Each Noteholder by accepting a Note authorizes and directs the Issuing and Paying Agent on its behalf to take such action as may be necessary or appropriate to acknowledge or effectuate the subordination between the Noteholders and the holders of Senior Indebtedness of the Issuer as provided in this Section 4 and appoints the Issuing and Paying Agent as attorney-in-fact for any and all such purposes.

Nothing herein shall impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Note in accordance with its terms. Nothing herein shall act to prohibit, limit or impede the Issuer from issuing additional debt of the Issuer having the same rank as the Subordinated Notes or which may be junior or senior in rank to the Subordinated Notes.

Each Noteholder by accepting a Note acknowledges and agrees that the foregoing subordination provisions are, and are intended to be, an inducement and a consideration to each holder of any Senior Indebtedness of the Issuer, whether such Senior Indebtedness was created or acquired before or after the issuance of the Notes, to acquire and continue to hold, or to continue to hold, such Senior Indebtedness and such holder of such Senior Indebtedness shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold, or in continuing to hold, such Senior Indebtedness.

Without in any way limiting the generality of the foregoing paragraph, the holders of Senior Indebtedness of the Issuer may, at any time and from time to time, without the consent of or notice to the Issuing and Paying Agent or the Noteholders, without incurring responsibility to the Issuing and Paying Agent or the Noteholders and without impairing or releasing the subordination provided in this Section 4 or the obligations hereunder of the Noteholders to the holders of the Senior Indebtedness of the Issuer, do any one or more of the following:  (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, Senior Indebtedness of the Issuer, or otherwise amend or supplement in any manner Senior Indebtedness of the Issuer, or any instrument evidencing the same or any agreement under which Senior Indebtedness of the Issuer is outstanding; (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Senior Indebtedness of the Issuer; (iii) release any Person liable in any manner for the payment or collection of Senior Indebtedness of the Issuer; and (iv) exercise or refrain from exercising any rights against the Issuer and any other Person.

5.            Consolidation, Merger and Sale of Assets.  The Issuer shall not consolidate with or merge into another person or entity, or convey or transfer its properties and assets substantially as an entirety to any person or entity, unless:

(a)            the person or entity formed by such consolidation or into which the Issuer is merged or the person or entity which acquires by conveyance or transfer the properties and assets of the Issuer substantially as an entirety is a corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization or any other entity organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and expressly assumes, by a supplemental agreement, the due and punctual payment of the principal of and any interest on the Subordinated Notes according to their terms, and the due and punctual performance and observance of all covenants and conditions to be performed by the Issuer contained in this Note and the Issuing and Paying Agency Agreement; and

(b)            immediately after giving effect to such transaction, no Event of Default (as defined herein), and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing.

Upon any such consolidation or merger, or conveyance or transfer, the successor entity or person formed, or into which the Issuer is merged or to which such conveyance or transfer is made, shall succeed to, and be substituted for, the Issuer under the Issuing and Paying Agency Agreement, and the Issuer shall be released from all of its obligations pursuant thereto.

6.            Events of Default; Acceleration.  If any of the following events shall occur and be continuing (each an "Event of Default"):

(a)            the Issuer shall consent to the appointment of a receiver, liquidator, trustee or other similar official in any bankruptcy, liquidation, insolvency or similar proceeding with respect to the Issuer; or

6

(b)            a court or other governmental agency or body having jurisdiction shall enter a decree or order for the appointment of a receiver, liquidator, trustee or other similar official in any bankruptcy, receivership, liquidation, insolvency or similar proceeding with respect to the Issuer and such decree or order shall have remained in force for 30 days; then, and in each such case, unless the principal of this Note already shall have become due and payable, the holders of 100% of the outstanding principal amount of the Subordinated Notes, by notice in writing to the Issuer, may declare the principal amount of this Note to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable.

7.            Failure to Make Payment.  In the event of failure by the Issuer to make any required payment of principal or interest on this Note (and, in the case of payment of interest, such failure to pay shall have continued for 30 calendar days), the Noteholders may (if such principal or interest remains unpaid following delivery by such Noteholders of notice to the Issuer) institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Issuer and collect the amounts adjudged or decreed to be payable in the manner provided by law.

8.            Payment Procedures.  Payment of the principal and interest payable on the Maturity Date will be made by wire transfer in immediately available funds to a bank account in the United States designated by the Noteholder, upon presentation and surrender of this Note at the office of the Issuing and Paying Agent or at such other place or places as the Issuer shall designate by notice to the Noteholders, provided that this Note is presented to the Issuing and Paying Agent in time for the Issuing and Paying Agent to make such payments in such funds in accordance with its normal procedures.  Payments of interest (other than interest payable on the Maturity Date or upon early redemption) shall be made by wire transfer in immediately available funds or check mailed to the person entitled thereto, as such person's address appears on the Security Register maintained by the Issuing and Paying Agent as of the applicable Regular Record Date or to such other address in the United States as any Noteholder shall designate to the Issuing and Paying Agent in writing not later than the relevant Regular Record Date.  Interest payable on any Interest Payment Date shall be payable to the holder in whose name this Note is registered at the close of business on the fifteenth calendar day (whether or not a Business Day) immediately preceding the applicable Interest Payment Date (such date being referred to herein as the "Regular Record Date"), except that interest not punctually paid may be paid to the Noteholder in whose name this Note is registered at the close of business on a Special Record Date fixed by the Issuer (a "Special Record Date"), notice of which shall be given to the holder not less than 15 calendar days prior to such Special Record Date.  (The Regular Record Date and Special Record Date are referred to herein collectively as the "Record Dates").  To the extent permitted by applicable law, interest shall accrue, at the rate at which interest accrues on the principal of this Note, on any amount of principal of or interest on this Note not paid when due.  All payments on this Note shall be applied first to accrued interest and then the balance, if any, to principal.

9.            Form of Payment, Maintenance of Payment Office.  Payments of principal of and interest on this Note shall be made in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts.  Until the date on which all of the Subordinated Notes shall have been surrendered or delivered to the Issuer or the Issuing and Paying Agent for cancellation or destruction, or become due and payable and a sum sufficient to pay the principal of and interest on all of the Subordinated Notes shall have been either paid or reserved for payment by the Issuer as provided herein, the Issuer shall at all times maintain an office or agency in the State of New York where Subordinated Notes may be presented or surrendered for payment. Any money that the Issuer pays to the Issuing and Paying Agent for the purpose of making payments on this Note and that remains unclaimed two years after the payments were due will, at the Issuer's request, be returned to it. After that time, the Noteholder of this Note can only look to the Issuer for payment on this Note.

7

10.            Registration of Transfer, Security Register.  Except as otherwise provided herein, this Note is transferable in whole and not in part, and may be exchanged for a like aggregate principal amount of Subordinated Notes of other authorized denominations, by the Noteholder in person, or by his attorney duly authorized in writing, at the office of the Issuing and Paying Agent.  The Issuing and Paying Agent shall maintain a register providing for the registration of ownership of the Subordinated Notes and any exchange or transfer thereof (the "Security Register").  Upon presentation of this Note for exchange or registration of transfer, the Issuer shall execute, authenticate and deliver in exchange therefor a Note or Notes of like tenor and terms, each in a denomination of $1,000 or any amount in excess thereof which is an integral multiple of $1,000 and, in the absence of an opinion of counsel satisfactory to the Issuer to the contrary, bearing the restrictive legends set forth on the face of this Note and that is or are registered in such name or names requested by the Noteholder.  Any Note presented for registration of transfer or for exchange shall be duly endorsed, or accompanied by a written instrument of transfer in form satisfactory to the Issuer, and shall be accompanied by such evidence of due authorization and guarantee of signature as may reasonably be required by the Issuer in form satisfactory to the Issuer, duly executed by the Noteholder or his attorney duly authorized in writing, with such tax identification number or other information for each person in whose name a Note is to be issued, and accompanied by evidence of compliance with any restrictive legends appearing on such Note or Notes as the Issuer may reasonably request to comply with applicable law.  No exchange or registration of transfer of this Note shall be made on or after the fifteenth day immediately preceding the Maturity Date.  This Note is subject to the restrictions on transfer set forth herein.  The Note may not be sold or otherwise transferred except in compliance with said agreement.

11.            Charges and Transfer Taxes.  No service charge (other than any cost of delivery) shall be imposed for any exchange or registration of transfer of this Note, but the Issuing and Paying Agent or the Issuer may require payment from the Noteholder of this Note of a sum sufficient to cover any stamp or other tax or governmental charge payable in connection therewith (other than exchanges pursuant to the Issuing and Paying Agency Agreement not involving any transfer) or presentation of evidence that such tax or charge has been paid.

12.            Ownership.  Prior to due presentment of this Note for registration of transfer, the Issuer may deem and treat the Noteholder as the absolute owner of this Note for the purpose of receiving payment of principal of and premium, if any, and interest on this Note and for all other purposes whatsoever.

13.            Notices.  All notices to the Issuer under this Note shall be in writing and addressed to the Issuer at Pinnacle Bank, 150 Third Avenue South, Suite 900, Nashville, TN 37201 Attention: Chief Financial Officer, or to such other address as the Issuer may provide by notice to the Noteholder.  All notices to the Noteholders shall be in writing and sent by first-class mail to each Noteholder at his or its address as set forth in the Security Register.  For so long as the Notes are represented by Global Notes, any notices to Noteholders will be delivered to DTC as the sole Noteholder in accordance with its applicable policies as in effect from time to time.

 

14.            Denominations.  The Subordinated Notes are issuable only as registered Notes without interest coupons in denominations of $1,000 or any amount in excess thereof which is a whole multiple of $1,000.

 

8

15.            Modification and Amendment.

(a)            Without the consent of any Noteholders, the Issuer and the Issuing and Paying Agent may enter into one or more modifications of the Issuing and Paying Agency Agreement or the Subordinated Notes, in form reasonably satisfactory to the Issuing and Paying Agent, to (i) evidence the succession of another entity to the Issuer and the assumption by any such successor of the obligations of the Issuer contained in the Issuing and Paying Agency Agreement and in the Subordinated Notes, (ii) change or eliminate any of the provisions of the Issuing and Paying Agency Agreement, provided that any such change or elimination shall become effective only when there is no outstanding Subordinated Note created prior to the execution of such amendment or modification which is entitled to the benefit of such provisions, (iii) establish other forms or terms of the Subordinated Notes as permitted in the Issuing and Paying Agency Agreement, (iv) evidence and provide for the acceptance of appointment under the Issuing and Paying Agency Agreement by a successor Issuing and Paying Agent, (v) cure any ambiguity, correct or supplement any provisions in the Issuing and Paying Agency Agreement or in this Note which may be inconsistent with any other provisions herein or in the Issuing and Paying Agency Agreement, or make any other provisions with respect to matters or questions arising herein or in the Issuing and Paying Agency Agreement; provided that such action shall not adversely affect the interests of any Noteholder in any material respect as determined in good faith by the board of directors of the Issuer, (vi) modify the restrictions on and procedures for resales and other transfers of the Subordinated Notes to reflect any change in applicable law or regulation (or the interpretation thereof) or in practices relating to the resale or other transfer of restricted securities generally, or (vii) modify, eliminate or add to the provisions of the Issuing and Paying Agency Agreement to such extent as shall be necessary to qualify the Issuing and Paying Agency Agreement (including any supplemental agreement thereto) under the Trust Indenture Act of 1939, as amended, or under such similar statute hereafter enacted.

(b)            With the consent of the Noteholders of a majority in aggregate principal amount of the outstanding Subordinated Notes affected thereby, the Issuer and the Issuing and Paying Agent may enter into one or more agreements supplemental to the Issuing and Paying Agency Agreement for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, the Issuing and Paying Agency Agreement or of modifying in any manner the rights of the Noteholders under the Issuing and Paying Agency Agreement; provided, however, that no such supplemental agreement shall, without the consent of each Noteholder affected thereby: (i) change the stated maturity date of the principal (or any installment of principal) of any Note, (ii) change any Interest Payment Date on which interest on any Note is to be paid, (iii) reduce the principal amount of any Note, (iv) reduce the rate of interest on any Note, (v) change the manner of calculation of interest on any Note, (vi) change any of the redemption provisions of any Note, (vii) change any place of payment for any Note, (viii) change the currency in which the principal of, or premium, if any, or interest on, any Note is payable, (ix) impair the right to institute suit for the enforcement of any required payment in respect of any Note on or after the stated maturity thereof, or (x) reduce the percentage of the aggregate principal amount of the outstanding Notes, the consent of whose Noteholders is required for the modification and amendment of the Issuing and Paying Agency Agreement and the Subordinated Notes.

16.            Absolute and Unconditional Obligation of the Issuer.  No provisions of this Note shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, places and rate, and in the coin or currency, herein prescribed.

17.            Waiver and Consent.  (a) Any consent or waiver given by the Noteholder shall be conclusive and binding upon such Noteholder and upon all future holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note.

(b)            No delay or omission of the Noteholder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.

(c)            Any insured depository institution which shall be a Noteholder or which otherwise shall have any beneficial ownership interest in any Note shall, by its acceptance of such Note (or beneficial interest therein), be deemed to have waived any right of offset with respect to the indebtedness evidenced thereby.

9

18.            Further Issues.  The Issuer may, from time to time, without the consent of any of the Noteholders, create and issue additional notes having the same terms and conditions of the Subordinated Notes in all respects (except for the issue date, issue price and initial Interest Payment Date) so that such additional notes would form a single series with the Subordinated Notes and rank equally and ratably with the Subordinated Notes or would form a new series.  No additional Subordinated Notes may be issued if any Event of Default has occurred and is continuing with respect to the Subordinated Notes.

19.            Governing Law.  This Note shall be governed by and construed in accordance with the laws of the State of New York.

20.            Satisfaction and Discharge.  The Issuing and Paying Agency Agreement and this Note will cease to be of further effect when:

(a)            either (A) all Notes heretofore authenticated and delivered (other than (i) Notes that have been destroyed, lost or stolen and that have been replaced or paid as provided in the Issuing and Paying Agency Agreement and (ii) Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such trust, as provided in the Issuing and Paying Agency Agreement) have been delivered to the Issuer for cancellation; or (B) all Notes not theretofore delivered to the Issuer for cancellation (i) have become due and payable, or (ii) will become due and payable at their stated maturity within one year, or (iii) are to be called for redemption within one year in accordance with the terms of the Issuing and Paying Agency Agreement and the Notes and, in the case of (B) (i), (ii) or (iii) above, the Issuer has irrevocably paid to the Noteholders funds in an amount in the currency in which the Notes are payable, sufficient to pay and discharge the entire indebtedness on the Notes not theretofore delivered to the Issuer for cancellation, for principal (and premium, if any) and interest with respect thereto, to the date of such payment (in the case of Notes that have become due and payable) or the stated maturity or redemption date, as the case may be;

(b)            the Issuer has paid or caused to be paid all or other sums payable under the Issuing and Paying Agency Agreement and the Notes; and

(c)            the Issuer has delivered to each Noteholder an officer's certificate stating that all conditions precedent described above relating to the satisfaction and discharge of the Issuing and Paying Agency Agreement and the Notes have been complied with.

[Signature Page Follows]

10

IN WITNESS WHEREOF, the undersigned has caused this Note to be duly executed and attested.

 PINNACLE BANK

By: /s/ M. Terry Turner                                                                                                  

		Name:	M. Terry Turner

		Title:	President and Chief Executive Officer

ATTEST:

/s/ Hugh M. Queener                                                                      

Name: Hugh M. Queener

Title:   Executive Vice President, Chief Administrative

Officer and Secretary

  

Dated: March 10, 2016

 

[Note Signature Page]

 

11

	
CERTIFICATE OF AUTHENTICATION

This is one of the Notes referred

to in the within-mentioned Issuing

 and Paying Agency Agreement

 

	 
	
U.S. BANK NATIONAL ASSOCIATION

 as Issuing and Paying Agent

 

By      /s/ David W. Doucette

 Authorized Signature

	 

 

 12Exhibit 10.1

 

Form of

 

HOME FEDERAL SAVINGS AND LOAN ASSOCIATION
OF COLLINSVILLE

 

EMPLOYEE STOCK OWNERSHIP PLAN

 

(adopted effective January 1, 2016)

 

     

     

    

 

HOME FEDERAL SAVINGS AND LOAN ASSOCIATION
OF COLLINSVILLE

EMPLOYEE STOCK OWNERSHIP PLAN

 

This Home Federal Savings
and Loan Association of Collinsville Employee Stock Ownership Plan (the “Plan”) has been executed, effective as of
the 1st day of January, 2016, by Home Federal Savings and Loan Association of Collinsville (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 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:	 	HOME FEDERAL SAVINGS AND LOAN ASSOCIATION OF COLLINSVILLE
	 	 	 	 
	 	 	By:	 
	Secretary	 	 	President and Chief Executive Officer

 

     

     

    

 

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.	11
	 	 	 	 
	3.1	 	Initial Eligibility	11
	3.2	 	Definition of Eligibility Year	11
	3.3	 	Terminated Employees	11
	3.4	 	Certain Employees Ineligible	11
	3.5	 	Participation and Reparticipation	12
	3.6	 	Omission of Eligible Employee	12
	3.7	 	Inclusion of Ineligible Employee	12
	 	 	 	 
	Section 4.	 	Contributions and Credits	12
	 	 	 	 
	4.1	 	Discretionary Contributions	12
	4.2	 	Contributions for Exempt Loans	13
	4.3	 	Conditions as to Contributions	13
	4.4	 	Rollover Contributions	14
	 	 	 	 
	Section 5.	 	Limitations on Contributions and Allocations	14
	 	 	 	 
	5.1	 	Limitation on Annual Additions	14
	5.2	 	Effect of Limitations	15
	5.3	 	Limitations as to Certain Participants	16
	5.4	 	Erroneous Allocations	16
	 	 	 	 
	Section 6.	 	Trust Fund and Its Investment	17
	 	 	 	 
	6.1	 	Creation of Trust Fund	17
	6.2	 	Stock Fund and Investment Fund	17
	6.3	 	Acquisition of Stock	17
	6.4	 	Participants’ Option to Diversify	18
	 	 	 	 
	Section 7.	 	Voting Rights and Dividends on Stock	19
	 	 	 	 
	7.1	 	Voting and Tendering of Stock	19
	7.2	 	Application of Dividends	20
	 	 	 	 
	Section 8.	 	Adjustments to Accounts	21
	 	 	 	 
	8.1	 	ESOP Allocations	21
	8.2	 	Charges to Accounts	22
	8.3	 	Stock Fund Account	22
	8.4	 	Investment Fund Account	22

 

     

     

    

 

	8.5	 	Adjustment to Value of Trust Fund	23
	8.6	 	Participant Statements	23
	 	 	 	 
	Section 9.	 	Vesting of Participants’ Interests	23
	 	 	 	 
	9.1	 	Vesting in Accounts	23
	9.2	 	Computation of Vesting Years	23
	9.3	 	Full Vesting Upon Certain Events	24
	9.4	 	Full Vesting Upon Plan Termination	25
	9.5	 	Forfeiture, Repayment, and Restoral	26
	9.6	 	Accounting for Forfeitures	26
	9.7	 	Vesting and Nonforfeitability	26
	 	 	 	 
	Section 10.	 	Payment of Benefits	27
	 	 	 	 
	10.1	 	Benefits for Participants	27
	10.2	 	Time for Distribution	27
	10.3	 	Marital Status	29
	10.4	 	Delay in Benefit Determination	29
	10.5	 	Accounting for Benefit Payments	29
	10.6	 	Options to Receive Stock	29
	10.7	 	Restrictions on Disposition of Stock	31
	10.8	 	Continuing Loan Provisions; Creations of Protections and Rights	31
	10.9	 	Direct Rollover of Eligible Distribution	31
	10.10	 	Waiver of 30-Day Period After Notice of Distribution	32
	 	 	 	 
	Section 11.   Rules Governing Benefit Claims and Review of Appeals	32
	 	 
	11.1	 	Claim for Benefits	32
	11.2	 	Notification by Committee	32
	11.3	 	Claims Review Procedure	33
	 	 	 	 
	Section 12.	 	The Committee and its Functions	33
	 	 	 	 
	12.1	 	Authority of Committee	33
	12.2	 	Identity of Committee	33
	12.3	 	Duties of Committee	34
	12.4	 	Valuation of Stock	34
	12.5	 	Compliance with ERISA	34
	12.6	 	Action by Committee	34
	12.7	 	Execution of Documents	34
	12.8	 	Adoption of Rules	34
	12.9	 	Responsibilities to Participants	34
	12.10	 	Alternative Payees in Event of Incapacity	35
	12.11	 	Indemnification by Employers	35
	12.12	 	Nonparticipation by Interested Member	35
	 	 	 	 
	Section 13.	 	Adoption, Amendment, or Termination of the Plan	35
	 	 	 	 
	13.1	 	Adoption of Plan by Other Employers	35
	13.2	 	Plan Adoption Subject to Qualification	35
	13.3	 	Right to Amend or Terminate	36
	 	 	 	 
	Section 14.	 	Miscellaneous Provisions	36
	 	 	 	 
	14.1	 	Plan Creates No Employment Rights	36
	14.2	 	Nonassignability of Benefits	36
	14.3	 	Limit of Employer Liability	37

 

    	ii 

     

    

 

	14.4	 	Treatment of Expenses	37
	14.5	 	Number and Gender	37
	14.6	 	Nondiversion of Assets	37
	14.7	 	Separability of Provisions	37
	14.8	 	Service of Process	37
	14.9	 	Governing State Law	37
	14.10	 	Employer Contributions Conditioned on Deductibility	37
	14.11	 	Unclaimed Accounts	38
	14.12	 	Qualified Domestic Relations Order	38
	14.13	 	Use of Electronic Media to Provide Notices and Make Participant Elections	39
	14.14	 	Acquisition of Securities	39
	 	 	 	 
	Section 15.	 	Top-Heavy Provisions	39
	 	 	 	 
	15.1	 	Top-Heavy Plan	39
	15.2	 	Definitions	39
	15.3	 	Top-Heavy Rules of Application	40
	15.4	 	Minimum Contributions	42
	15.5	 	Top-Heavy Provisions Control in Top-Heavy Plan	42

 

    	iii 

     

    

 

HOME FEDERAL SAVINGS AND LOAN ASSOCIATION
OF COLLINSVILLE

EMPLOYEE STOCK OWNERSHIP PLAN

 

Section 1.        Plan
Identity.

 

1.1       Name.
The name of this Plan is “Home Federal Savings and Loan Association of Collinsville 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 January 1, 2016.

 

1.4       Fiscal
Period. This Plan shall be operated on the basis of a January 1 to December 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. However, a Participant shall not qualify as an Active Participant unless (i) he is in active Service
with an Employer as of the last day of the Plan Year, or (ii) he is on a Recognized Absence as of

 

     

     

    

 

that date, or (iii) his Service terminated
during the Plan Year by reason of Disability, death, or Normal Retirement.

 

“Bank”
means Home Federal Savings and Loan Association of Collinsville and any entity which succeeds to the business of Home Federal Savings
and Loan Association of Collinsville 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. 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. Hours of Service shall be
credited only in the year in which the absence from work begins, if a Participant would be prevented from incurring a one-year
Break in Service in such year solely because the period of absence is treated as Hours of Service, or in any other case, in the
immediately following year.

 

“Closing Date”
means the closing date of the stock offering of the Company.

 

“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 Best Hometown Bancorp, Inc., the holding company of the Bank, and any successor entity which succeeds to the business of
the Company. The Company is a publicly traded corporation and it is taxed as a corporation under Sub-Chapter C of the Code.

 

“Compensation”
means Form W-2, Box 1 income.

 

For purposes of this
Section, the determination of Compensation shall be made by:

 

(a)        including
amounts which are contributed by the Employer pursuant to a salary reduction agreement and which are not includible in the gross
income of the

 

    	2 

     

    

 

Participant under Sections 125,
132(f)(4), 402(g)(3), or 457 of the Code, and Employee contributions described in Section 414(h)(2) of the Code that are treated
as Employer contributions.

 

(b)        excluding
amounts realized from the exercise of a non-qualified stock option (including income realized upon a disqualifying disposition
of a qualified or incentive stock option) or when restricted stock (or property) held by a Participant becomes freely transferable
or is no longer subject to a substantial risk of forfeiture; excluding amounts includible in the gross income of a Participant
upon the making of an election described in Section 83(b) of the Code; and excluding amounts realized from the sale, exchange or
other disposition of stock acquired from or under a stock option;

 

A Participant’s
Compensation shall exclude any portion of the Plan Year in which the Participant had not yet entered the Plan (e.g., the period
before the Participant’s Entry Date).

 

Compensation in excess
of $255,000 (or such other amount provided in the Code) shall be disregarded. Such amount shall be adjusted for increases in the
cost of living in accordance with Section 40l(a)(17)(B) of the Code, except that the dollar increase in effect on January 1 of
any calendar year shall be effective for the Plan Year beginning with or within such calendar year. For any short Plan Year, the
Compensation limit shall be an amount equal to the Compensation limit for the calendar year in which the Plan Year begins multiplied
by the ratio obtained by dividing the number of full months in the short Plan Year by twelve (12).

 

“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.

 

“Eligible
Employee” means an Employee, other than an Employee identified in Section 3.4, who has performed 1,000 Hours of Service
in the applicable Eligibility Year in accordance with Section 3.2 and who has attained age 21.

 

“Employee”
means any individual who is or has been 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 Compensated Employees and any other Employees who have not performed
services for the Employer on a substantially full-time basis for at least one

 

    	3 

     

    

 

year). In addition, Employee also includes
employees described in Code Section 414(o) that are required to be treated as employed by the Employer.

 

“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.

 

“Entry Date”
means the Effective Date of the Plan and each January 1 and July 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).

 

“Exempt Loan”
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 Section 54.4975-12;

 

(ii)        to
repay such Exempt Loan; or

 

(iii)       to
repay a prior exempt loan.

 

“415 Compensation”
shall mean:

 

(a)        Wages
(including overtime pay, bonuses and commissions), 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 (including any “deemed”
Code Section 125 compensation) (Cafeteria Plan), Code Section 457, 132(f)(4) or because such amount was deferred in accordance
with an Employer-provided deferred compensation plan, shall also be included in the definition of 415 Compensation.

 

(c)        415
Compensation shall also include the following types of compensation paid after a Participant’s severance from employment
with the Employer, provided that amounts described in paragraphs (i) or (ii) below shall only be included in 415 Compensation to
the extent such amounts are paid by the later of 21⁄2 months after severance from employment, or by the end of the limitation
year that includes the date of such severance from employment.

 

    	4 

     

    

 

(i)        Regular
Pay. 415 Compensation shall include regular pay after severance from employment if (a) the payment is for regular compensation
for services during the Participant’s regular working hours, or compensation for services outside of the Participant’s
regular working hours (such as overtime or shift differential), commissions, bonuses, or other similar payments, and (b) the payment
would have been paid to the Participant prior to severance from employment if the Participant had continued in employment with
the Employer.

 

(ii)       Leave
Cashouts. Leave cashouts shall be included in 415 Compensation if those amounts would have been included in the definition of 415
Compensation if they were paid prior to the Participant’s severance from employment, and the amounts are payment for unused
accrued bona fide sick, vacation or other leave, but only if the Participant would have been able to use the leave if his employment
had continued.

 

(d)        415
Compensation includes differential wage payments (as defined in Code Section 3401(h)) paid by the Employer to a former Employee
who is performing qualified military services (as defined in Code Section 414(u)(1)) but only to the extent that those differential
wage payments do not exceed the amounts the individual would have received if the individual had continued to perform services
for the Employer rather than entering qualified military service.

 

(e)        415
Compensation in excess of $255,000 (as indexed) shall be disregarded for all Participants. For purposes of this sub-section, the
$255,000 limit shall be referred to as the “applicable limit” for the Plan Year in question. The $255,000 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 and only compensation for the portion of the Plan Year during which the individual was a Participant shall
be taken into account.

 

“Highly Compensated
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 $115,000 (as adjusted) and was in the top-paid group of Employees. For these purposes, the top-paid
group of Employees means the most highly compensated one-fifth of all Employees and 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 171⁄2 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:

 

    	5 

     

    

 

(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.

 

(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 90 Hours of Service for each bi-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 Committee 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

 

    	6 

     

    

 

Stock in the open market or otherwise,
or used to pay on the Exempt Loan, 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 Participant’s 65th birthday.

 

“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.

 

“Period of
Uniformed Service” means the length of time that an Employee serves in the Uniformed Services.

 

“Plan Year”
means the twelve-month period commencing January 1 and ending December 31 and each period of 12 consecutive months beginning on
January 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).

 

“Reemployment
After a Period of Uniformed Service”

 

(a)        “Reemployment
(or Reemployed) After a Period of Uniformed Service” means that an Employee returned to employment with a Participating
Employer, within the time frame set forth in subparagraph (b) below, after a Period of Uniformed Service in the Uniformed
Services and the following rules corresponding to provisions of the Uniformed Services Employment and Reemployment Rights Act of
1994 (“USERRA”) apply: (i) he or she gives sufficient notice of leave to the Participating Employer prior
to commencing a Period of Uniformed Service, or is excused from providing such notice; (ii) his or her employment with the
Participating Employer prior to a Period of Uniformed Service was not of a brief, nonrecurrent nature that would preclude a reasonable
expectation that such employment would continue indefinitely or for a significant period; (iii) the Participating Employer’s
circumstances have not changed so that reemployment is unreasonable or an undue hardship to the Participating Employer; and (iv) the
applicable cumulative Periods of Uniformed Service under USERRA equals five years or less, unless service in the Uniformed Services:

 

    	7 

     

    

 

(1)       in
excess of five years is required to complete an initial Period of Uniformed Service;

 

(2)       prevents
the Participant from obtaining orders releasing him or her from such Period of Uniformed Service prior to the expiration of a five-year
period (through no fault of the Participant);

 

(3)       is
required in the National Guard for drill and instruction, field exercises or active duty training, or to fulfill necessary additional
training, or to fulfill necessary additional training requirements certified in writing by the Secretary of the branch of Uniformed
Services concerned; or

 

(4)       for
a Participant is

 

(A)       required
other than for training under any provisions of law during a war or national agency declared by the President or Congress;

 

(B)       required
(other than for training) in support of an operational mission for which personnel have been ordered to active duty other
than during war or national emergency;

 

(C)       required
in support of a critical mission or requirement of the Uniformed Services; or

 

(D)       the
result of being called into service as a member of the National Guard by the President in the case of rebellion or danger of rebellion
against the authority of the United States Government or if the President is unable to execute the laws of the United States with
the regular forces.

 

(b)        The
applicable statutory time frames within which an Employee must report to a Participating Employer after a Period of Uniformed Service
are as follows:

 

(1)       If
the Period of Uniformed Service was less than 31 days,

 

(A)       not
later than the beginning of the first full regularly scheduled work period on the first full calendar day following the completion
of the Period of Uniformed Service and the expiration of eight hours after a period of time allowing for the safe transportation
of the Employee from the place of service in the Uniformed Services to the Employee’s residence; or

 

(B)       as
soon as possible after the expiration of the eight-hour period of time referred to in Clause (A), if reporting within the period
referred to in such clause is impossible or unreasonable through no fault of the Employee.

 

    	8 

     

    

 

(2)       In
the case of an Employee whose Period of Uniformed Service was for more than 30 days but less than 181 days, by submitting an application
for reemployment with a Participating Employer not later than 14 days after the completion of the Period of Uniformed Service or,
if submitting such application within such period is impossible or unreasonable through no fault of the Employee, the next first
full calendar day when submission of such application becomes reasonable.

 

(3)       In
the case of an Employee whose Period of Uniformed Service was for more than 180 days, by submitting an application for reemployment
with a Participating Employer not later than 90 days after the completion of the Period of Uniformed Service.

 

(4)       In
the case of an Employee who is hospitalized for, or convalescing from, an illness or injury related to the Period of Uniformed
Service the Employee shall apply for reemployment with a Participating Employer at the end of the period that is necessary for
the Employee to recover. Such period of recovery shall not exceed two years, unless circumstances beyond the Employee’s control
make reporting as above unreasonable or impossible.

 

(c)        Notwithstanding
subparagraph (a), Reemployment After a Period of Uniformed Service terminates upon the occurrence of any of the following:

 

(1)       a
dishonorable or bad conduct discharge from the Uniformed Services;

 

(2)       any
other discharge from the Uniformed Services under circumstances other than an honorable condition;

 

(3)       a
discharge of a commissioned officer from the Uniformed Services by court martial, by commutation of sentence by court martial,
or, in time of war, by the President; or

 

(4)       a
demotion of a commissioned officer in the Uniformed Services for absence without authorized leave of at least 3 months confinement
under a sentence by court martial, or confinement in a federal or state penitentiary after being found guilty of a crime under
a final sentence.

 

“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) 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)

 

    	9 

     

    

 

or 414(c) of the Code, and a member of
the controlled group or one of the trades and businesses is an Employer, (ii) 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 common stock issued by the Employer (or by a corporation which is a member of the same controlled group) which is readily
tradable on an established securities market. In the event there is no common stock which meets the requirements of the preceding
sentence, then “Stock” means common stock issued by the Employer (or by a corporation which is a member of the same
controlled group) having a combined voting power and dividend rights equal to or in excess of (A) that class of common stock of
the Employer (or of any other such corporation) having the greatest voting power; and (B) that class of common stock of the Employer
(or of any other such corporation) having the greatest dividend rights.

 

“Stock Fund”
means that portion of the Trust Fund consisting of Stock.

 

“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.

 

“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 Exempt Loans and which have not yet been allocated to the Participant’s Accounts in accordance
with Section 4.2.

 

“Uniformed
Service” means the performance of duty on a voluntary or involuntary basis in the uniformed service of the United States,
including the U.S. Public Health Services, under competent authority and includes active duty, active duty for training, initial
activity duty for training, inactive duty training, full-time National Guard duty, and the period for which a person is absent
from a position of employment for purposes of an examination to determine the fitness of the person to perform any such duty.

 

    	10 

     

    

 

“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 last
day of the Eligible Employee’s first Eligibility Year and attainment of age 21. Notwithstanding the foregoing, an Employee
who is an Eligible Employee on or prior to the Closing Date shall enter the Plan, retroactively, on the Effective Date.

 

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:

 

(i)         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, including any years before the Effective Date of the Plan, and

 

(ii)        his
subsequent eligibility periods will be 12-consecutive month periods beginning on each January 1 after that first day of Service.

 

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.

 

3.4-1.  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.

 

3.4-2.  Leased
Employees are not eligible to participate in the Plan.

 

3.4-3.  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)).

 

    	11 

     

    

 

3.4-4.  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 effective for a particular Plan Year, the Eligible Employee or Participant must file
the election in writing with the Committee no later than the last day of the Plan Year for which the election is to be effective.
The Employer and all affiliates have never been an S-Corporation.

 

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 one year 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 Plan 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. Any person who, after the close of a Plan
Year, is retroactively treated by the Company, an affiliated company or any other party as an Employee for such prior Plan Year
shall not, for purposes of the Plan, be considered an Employee for such prior Plan Year unless expressly so treated as such by
the Company.

 

Section 4.        Contributions
and Credits.

 

4.1       Discretionary
Contributions.

 

4.1-1.  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 the manner set forth in Section 8.1-2.

 

4.1-2.  Upon
a Participant’s Reemployment After a Period of Uniformed Service, the Employer shall make an additional contribution on behalf
of such Participant that

 

    	12 

     

    

 

would have
been made on his or her behalf during the Plan Year or Years corresponding to the Participant’s Period of Uniformed Service.

 

4.2       Contributions
for Exempt Loans. If the Trustee, upon instructions from the Committee, incurs any Exempt Loan 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 Exempt Loan. If there is more than one Exempt Loan, 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 Exempt Loan related to that Stock, subject to Section 7.2.

 

In each Plan Year in
which Employer contributions, earnings on contributions, or dividends on Stock in the Unallocated Stock Fund are used as payments
under an Exempt Loan, a certain number of shares of the Stock acquired with that Exempt Loan 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 Exempt Loan in the current Plan Year bears to (ii) the sum of (i) above, 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 Exempt Loan.

 

At the direction of
the Committee, the current and projected payments of interest under an Exempt Loan may be ignored in calculating the number of
shares to be released in each year if (i) the Exempt Loan 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 Exempt Loan, 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 13.2 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.

 

    	13 

     

    

 

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 would cause any Highly Compensated Employee to exceed the limitations
under Code Section 415(c) or the Employer to exceed the deduction limits under Code Section 404, then no more than the maximum
amount permitted by either Code Sections 404 and 415(c) shall be allocated to the accounts of Highly Compensated Employees (within
the meaning of Code Section 414(q)), with the remaining Employer contributions to be made to non-Highly Compensated Employees in
the manner specified under Section 8.1. Such adjustments shall be made before any allocations 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 $51,000 (for 2013, 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”). In the event Stock is released from the Unallocated Stock Fund and allocated to
a Participant’s Account for a particular Plan Year, the Employer may determine for such year that an annual addition shall
be calculated on the basis of the fair market value of the Stock so released and allocated (such fair market value to be based
on the valuation as of the Valuation Date immediately preceding the Plan Year in respect of which the release and allocation are
made) if the annual addition, as so calculated, is lower than the annual addition calculated on the basis of Employer contributions.
The percentage limitation shall not apply to any contribution for medical benefits after severance from employment (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 Plan may only correct such excess in accordance with the Employee Plans Compliance Resolution
System (EPCRS) as set forth in Revenue Procedure 2008-50 or any subsequent guidance.

 

    	14 

     

    

 

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. Notwithstanding the foregoing, “annual additions”
shall not include a restorative payment in accordance with Treasury Regulation Section 1.415(c)-1(b)(2)(C) that is made to restore
losses to the Plan resulting from actions by a fiduciary for which there is a reasonable risk of liability for breach of fiduciary
duty under ERISA or other applicable federal and state law.

 

In the event
Stock is released from the Unallocated Stock Fund and allocated to a Participant’s Account for a particular Plan Year, the
Employer may determine for such year that an annual addition shall be calculated on the basis of the fair market value of the Stock
so released and allocated (such fair market value to be based on the valuation as of the Valuation Date immediately preceding the
Plan Year in respect of which the release and allocation are made) if the annual addition, as so calculated, is lower than the
annual addition calculated on the basis of Employer contributions.

 

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 Compensated 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.

 

5.1-5If
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 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.

 

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

 

    	15 

     

    

 

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, after taking into consideration Sections 3.6 and 3.7 and any revenue procedure or other notice published
by the Internal Revenue Service regarding permissible correction

 

    	16 

     

    

 

methods, if applicable, 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.

 

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. As a directed
Trustee, the Trustee shall have such responsibility for the investment of the Investment Fund as set forth in Section .05 of the
Trust Agreement.

 

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 an “Exempt Loan.” The term
“Exempt Loan” 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. An Exempt Loan 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 an Exempt Loan in order to qualify as an “exempt loan” is not a refinancing of
the Exempt Loan or the making of another Exempt Loan. The term “exempt loan” refers to a loan that is primarily for
the benefit of the Plan participants and their beneficiaries and that satisfies the provisions of this paragraph. A “non-exempt
loan” fails to satisfy this paragraph. Any Exempt Loan shall be subject to the following conditions and limitations:

 

6.3-1  All
Exempt Loans incurred by the Plan must be primarily for the benefit of Plan Participants and Beneficiaries, and an Exempt Loan
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, such that the interest rate and the price of the securities to be acquired

 

    	17 

     

    

 

with the Exempt Loan will not
cause the Plan’s assets to be inappropriately impaired in violation of Treasury Regulation Section 54.4975-7(b)(3).

 

6.3-2  An
Exempt Loan may, but need not, be secured by a collateral pledge of either the Stock acquired in exchange for the Exempt Loan,
or the Stock previously pledged in connection with a prior Exempt Loan which is being repaid with the proceeds of the current Exempt
Loan. No other assets of the Plan and Trust may be used as collateral for an Exempt Loan, and no creditor under an Exempt Loan
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 an Exempt Loan must provide for the release of pledged Stock in connection with payments on the Exempt
Loans in the ratio prescribed in Section 4.2.

 

6.3-4  Repayments
of principal and interest on any Exempt Loan 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. The payment on the Exempt Loan during the Plan Year must not exceed an amount equal
to the sum of contributions and earnings received during such year or prior to such year, less such payments in prior years. Such
contributions and earnings must be accounted for separately in the books and accounts of the Plan until the Exempt Loan is fully
repaid.

 

6.3-5  In
the event of default of an Exempt Loan, the value of Plan assets transferred in satisfaction of the Exempt Loan must not exceed
the amount of the default. If the lender is a disqualified person within the meaning of Section 4975 of the Code, an Exempt Loan
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 Exempt Loan. 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 percent 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

 

    	18 

     

    

 

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.

 

7.1-1  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 a 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, allocated Stock for which it has received no voting instructions, and Stock for which Participants
vote to “abstain,” in the same proportions as it votes the allocated Stock for which it has received instructions from
Participants. 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.

 

    	19 

     

    

 

7.1-2  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       Application
of Dividends.

 

7.2-1  Stock
Dividends. 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 Participants’ Accounts and the Unallocated Stock Fund in accordance with their holdings
of the Stock on which the dividends are paid.

 

7.2-2  Cash
Dividends. The treatment of dividends paid in cash shall be determined after consideration to whether the cash dividends are
paid on Stock held in Participants’ Accounts or the Unallocated Stock Fund.

 

(i)        On
Stock in Participants’ Accounts.

 

(A)       Employer
Exercises Discretion. 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 8.4(iii) 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 Exempt Loan. If dividends on Stock allocated to a Participant’s Account are used to repay the Exempt Loan, 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.

 

(B)       Participant
Exercises Discretion over Dividend. In addition, in the sole discretion of the Employer, the Employer may grant Participants
the right to elect: (I) to have cash dividends paid on shares of Stock credited to such Participants’ Stock Fund Accounts
distributed to the Participant, or (II) to leave the cash dividends allocated to the Participant’s Account in the Plan, to
be credited to the Stock Fund Account and invested in shares of Stock. Dividends on which such election may be made will be fully
vested in the Participant (even if not otherwise vested, absent the ability to make such election). Accordingly, the Employer may
choose to offer this election only to Participants who are fully vested in their Account. In the event the Employer elects to give
Participants the right to determine the treatment of such dividends, the Participant’s election shall be made by filing with
the Committee the appropriate written direction as provided by the Committee at such time

 

    	20 

     

    

 

and in accordance with such procedures
and limitations which the Committee may from time to time establish; provided, however, that the procedures established by the
Committee shall provide a reasonable opportunity to change the election at least annually, may establish a default election if
a Participant fails to make an affirmative election within the time established for making elections, may provide that the election
is applicable for the Plan Year and cannot be revoked with respect to such Plan Year, shall otherwise be implemented in a manner
such that the dividends paid or reinvested will constitute “applicable dividends” which may be deducted under Code
Section 404(k), and are in accordance with applicable guidance issued or to be issued by the Secretary of the Treasury. If the
Employer elects to give Participants the right to exercise the discretion in this Paragraph 7.2-2(i)(B), the ability to make such
election shall be available to the Participant with respect to dividends paid for the entire Plan Year.

 

(ii)       On
Stock in the Unallocated Stock Fund. Dividends received on shares of Stock held in the Unallocated Stock Fund shall be applied
to the repayment of principal and interest then due on the Exempt Loan used to acquire such shares. If the amount of dividends
exceeds the amount needed to repay such principal and interest (including any prepayments of principal and interest deemed advisable
by the Employer), then in the sole discretion of the Committee, the excess shall: (A) be allocated to Active Participants, pro
rata, in proportion to the Compensation of each such person that was earned during that portion of the Plan Year that such person
participated in the Plan compared to total Compensation of each Active Participant for such year, or (B) be deemed to be general
earnings of the Trust Fund and used for paying appropriate Plan or Trust related expenditures for the Plan Year. Notwithstanding
the foregoing, dividends paid on a share of Stock may not be used to make payments on a particular Exempt Loan unless the share
was acquired with the proceeds of such loan or a refinancing of such loan.

 

Section 8.        Adjustments
to Accounts.

 

8.1       ESOP
Allocations. Amounts available for allocation for a particular Plan Year will be divided into two categories. The first
category relates to shares of Stock released from the Unallocated Stock Fund attributable to using cash dividends to make Exempt
Loan payments. The second category relates to contributions made by the Employer, shares of Stock released from the Unallocated
Stock Fund on the basis of Employer contributions (or on the basis of the complete repayment of the Exempt Loan through the sale
or other disposition of Stock in the Unallocated Stock Fund) and amounts forfeited from Stock Fund Accounts pursuant to Section
9.5.

 

8.1-1  Shares
of Stock attributable to the first category will be allocated to the Stock Fund Accounts of eligible Participants as follows:

 

(i)        first,
if dividends paid on shares of Stock held in Participants’ Stock Fund Accounts are used to make payments on an Exempt Loan,
there shall

 

    	21 

     

    

 

be allocated to each such account
a number of shares of Stock released from the Unallocated Stock Fund with a fair market value (determined as of the Valuation Date
coincident with or immediately preceding the loan payment date) that at least equals the amount of dividends so used,

 

(ii)        second,
if necessary, any remaining shares of Stock shall be applied to reinstate amounts forfeited from Stock Fund Accounts of former
employees who are entitled to a reinstatement under Section 9.5, and

 

(iii)       finally,
any remaining shares of Stock shall be allocated as of the last Valuation Date of the Plan Year for which they are allocated in
the same manner as described in Section 8.1-2.

 

8.1-2  Shares
of Stock or cash attributable to the second category (i.e., Employer contributions, Stock released from the Unallocated Stock Fund
on the basis of Employer contributions, amounts forfeited, and, to the extent applicable, shares of Stock released in accordance
with Section 8.1-1(iii)) will be allocated to the Stock Fund Accounts or Investment Fund Accounts, as the case may be, pro rata,
in proportion to the Compensation of each Active Participant that was earned by such Participant during the period of the Plan
Year in which such person participated in the Plan compared to total Compensation for all Active Participants.

 

8.1-3  Shares
of Stock or cash attributable to contributions made under Section 4.1-2 shall be allocated specifically to the Participants
on whose behalf such contributions were made.

 

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 Exempt Loan 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 Exempt Loans, 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 to Active Participants, in proportion to the number of shares
held in Active Participants’ Stock Fund Accounts.

 

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

 

    	22 

     

    

 

Account: (i) 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 an Exempt Loan; (ii) the Participant’s allocable share of any forfeitures
from the Investment Fund Accounts of other Participants arising under the Plan during that year; (iii) 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 Exempt Loan; and (iv) 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 Committee shall provide or shall cause to be provided to each Participant a statement of
his or her Account balances, and the vested percentage thereof, as of the last day of the Plan Year.

 

Section 9.        Vesting
of Participants’ Interests.

 

9.1       Vesting
in Accounts. A Participant’s vested interest in his Account shall be based on his Vesting Years in accordance with
the following table, subject to the balance of this Section 9:

 

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

 

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 performed 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 including Service with other Employers as provided in the definition of “Service.”
Notwithstanding the above, an Eligible Employee who was employed with the Bank shall receive credit for vesting purposes for each
calendar year of

 

    	23 

     

    

 

continuous employment with the Bank, prior
to the adoption of the Plan, 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 Employee attains age 18.

 

9.2-2  To
the extent applicable, a Participant’s vested interest in his Account accumulated before five (5) consecutive one year 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 one year Breaks in Service before his interest in his Account has become vested to some extent, pre-Break
in Service years of Service shall not be required to be taken into account for purposes of determining his post-Break in Service
vested percentage.

 

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

 

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

 

(ii)       upon
returning to Service the number of consecutive one 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, 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. For
purposes of this Section 9.3-1, benefits payable in the event of a Participant’s death or Disability while performing qualified
military service shall fully vest in accordance with Section 414(u)(9) of the Code.

 

    	24 

     

    

 

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” means 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 Bank Holding Company Act of 1956, as amended (“BHCA”); 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 the 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 of the Directors 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 is distributed, 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 business organizations 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, the Plan shall be terminated as of the date of such Change in Control.

 

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. A partial termination of the Plan shall be determined by the Internal Revenue Service Commissioner based on the
facts and circumstances of the particular case in accordance with Code Section 411(d)(3) and the corresponding Treasury Regulations
issued thereunder.

 

    	25 

     

    

 

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 at the earlier of the date the Participant (i) receives a distribution of
his entire vested interest, or (ii) incurs five consecutive one-year Breaks 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 one-year
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, then from amounts allocated
in accordance with Section 8.1-1(ii), and if insufficient, then from a special contribution by his Employer for that year. A Participant
who was deemed to have received a 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.

 

In addition, if a Participant
did not receive a distribution of his vested Account balance but his non-vested Account balance was forfeited after a one-year
Break in Service, such nonvested Account balance shall be restored if the Plan terminates before the Participant has a five-year
Break in Service. 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.

 

For purposes of this
Section and Section 5.1 of the Plan, if a portion of a Participant’s Account is forfeited, Stock allocated from an Exempt
Loan will be forfeited only after other assets. 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 such class.

 

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.

 

    	26 

     

    

 

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 payment in a lump sum, in accordance with
Section 10.2. Prior to any such distribution, any Participant entitled to a distribution will receive a form upon which the
Participant can elect the manner of such distribution (e.g., whether to receive the distribution directly or transfer such distribution
to an individual retirement account or other tax-qualified plan), a special tax notice regarding the consequences of such distribution,
and, if applicable, that the Participant has the right not to consent to a distribution at such time.

 

If a Participant so
desires, he may direct how his benefits are to be paid to his Beneficiary. Notice to the Participant with regard to having the
right to elect the manner in which his vested Account balance will be distributed to him may be given up to 180 days before the
first day of the first period for which an amount is payable. 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 exceed $1,000, then such
Participant’s vested Account shall be distributed, without regard to whether the Participant consents, 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 in excess of $5,000, then his benefits shall not be paid prior to his Normal Retirement Date 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. The Committee shall provide the Participant
with written notice designed to comply with the requirements of Code Section 411(a)(11), and shall provide the Participant with
a general description of the material features of the optional forms of benefits under the Plan and the right to defer receipt
of any distribution under the Plan. Such notice shall be provided no less than 30 days and no more than 180 days before the date
a distribution under the Plan commences. Notwithstanding the foregoing, failure of a Participant to consent to a distribution prior
his Normal Retirement Date shall be deemed to be an election to defer commencement of payment of any benefit under this section.
Notwithstanding the foregoing, unless a Participant elects to receive a distribution, the Committee shall transfer accounts of
$1,000 or more, but not exceeding $5,000, in a direct rollover to an individual retirement plan designated by the Committee in
accordance with Code Section 401(a)(31)(B) and the regulations promulgated thereunder. All distributions of $5,000 or less that
are made pursuant to this Section without the Participant’s consent shall be made in cash.

 

Notwithstanding anything
to the contrary, in the event the Participant dies while performing qualified military service (as defined Section 414(u) of the
Code), the Participant’s Beneficiary shall be entitled to any additional benefit provided under the Plan had the Participant
resumed and then severed from employment on account of death.

 

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,

 

    	27 

     

    

 

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 in which the Participant severs employment by reason of attainment of Normal Retirement Age under the Plan, Disability, or
death, or which is the fifth Plan Year following the Plan Year in which the Participant otherwise severs employment, except that
this clause shall not apply if the Participant is reemployed by the Employer before distribution is required to begin.

 

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 701⁄2, 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 701⁄2, 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 701⁄2.
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 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 at the date of his death.

 

(iii)       If
a married Participant dies before his benefit payments begin, then the Committee shall cause the balance in his Account to be paid
to his Beneficiary, provided, however, that no election by a married Participant of a

 

    	28 

     

    

 

different Beneficiary
than his surviving Spouse shall be valid unless the election is accompanied by the Spouse’s written consent, which (A) must
acknowledge the effect of the election, (B) 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 (C)
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  If
a Participant or any other distributee’s distribution is rolled over to another eligible retirement plan following the Participant’s
required beginning date (as determined in accordance with Section 10.2-3), only the amount that exceeds the required minimum distribution
amount for the Plan Year (as determined in accordance with Code Section 401(a)(9)) in which the rollover is completed is treated
as an eligible rollover distribution for purposes of Section 10.9.

 

10.2-6  All
distributions under this section shall be determined and made in accordance with Code Section 401(a)(9) and final Treasury Regulations
Sections 1.401(a)(9)-1 through 1.401(a)(9)-9, including the minimum distribution incidental benefit requirements of Code Section
401(a)(9)(G). 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. 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, other than as specifically set forth in Section 10.1, the Participant’s vested interest in his account
shall be distributed in shares of Stock and/or cash at the direction of the Participant. If Stock acquired with the proceeds of
an Exempt Loan available

 

    	29 

     

    

 

for distribution consist of more than one
class of Stock, the Participant (or Beneficiary, if applicable) must receive substantially the same proportion of each such class.

 

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.

 

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.

 

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 Exempt Loan, the put right shall be nonterminable. The put right for Stock acquired
through an Exempt Loan shall continue with respect to such Stock after the Exempt Loan is repaid or the Plan ceases to be an employee
stock ownership plan. Notwithstanding anything in the Plan to the contrary, if securities acquired with the proceeds of an Exempt
Loan available for distribution consist of more than one class, a distributee must receive substantially the same proportion of
each such class, in accordance with Treasury Regulations Section 54.4975-11(f)(2).

 

Notwithstanding anything
in the Plan to the contrary, if securities acquired with the proceeds of an exempt loan available for distribution consist of more
than one class, a distributee must receive substantially the same proportion of each such class, in accordance with Treasury Regulations
Section 54.4975-11(f)(2).

 

    	30 

     

    

 

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). Notwithstanding
the foregoing, an “eligible rollover” shall include a distribution that is made to a “distributee” as defined
under Section 10.9-4.

 

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), a deemed individual retirement account described in Code Section 408(q), an annuity plan
described in Code Section 403(a), a Roth individual retirement account in accordance with Code Section 408A(e), or a qualified
trust described in Code Section 401(a), that accepts the distributee’s eligible rollover distribution. 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. An eligible

 

    	31 

     

    

 

retirement plan shall also include
a deemed individual retirement account described in Code Section 408(q), a Roth individual retirement account in accordance with
Code Section 408A(e), and an annuity plan described in Code Section 403(a).

 

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), and shall include non-Spouse
Beneficiaries pursuant to Code Section 402(c)(11).

 

10.9-5 The
Committee shall provide Participants or other distributes of eligible rollover distributions with a written notice designed to
comply with the requirements of Code Section 402(f). Such notice shall be provided within a reasonable period of time before making
an eligible rollover distribution. Such notice may be provided up to 180 days before the first day of the first period for which
an amount is payable.

 

10.10   Waiver
of 30-Day Period After Notice of Distribution. If a distribution is one to which Sections 402(f) and 411(a)(11) of the
Code apply, such distribution may commence less than 30 days after the notice required under Section 1.402(f)-1 or 1.411(a)-11(c)
of the Treasury 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 to make a tax-free rollover or receive a taxable
distribution (and, if applicable, a particular form of distribution), and

 

(ii)        the
Participant, after receiving the notice, affirmatively elects to make a tax-free rollover or receive a taxable 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:

 

    	32 

     

    

 

(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 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 two 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.

 

    	33 

     

    

 

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 Exempt
Loans. 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. 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.

 

12.4     Valuation
of Stock. If the valuation of any Stock is not readily tradable on an established securities 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. The Valuation Date for all Plan transactions, including transactions between the Plan and a disqualified person, shall be
the date of the transaction, in accordance with Treasury Regulations Section 54.4975-11(d)(5).

 

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

 

    	34 

     

    

 

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 such decision is consistent with applicable law, the Plan document and in the best interests
of all Participants and Beneficiaries in a non-discriminatory manner.

 

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.

 

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)

 

    	35 

     

    

 

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). In addition, reversions
of Employer contributions (including earnings or losses attributable thereto) are permitted within one year after the applicable
determination date, if the reversion is due to a good faith mistake of fact.

 

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 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

 

    	36 

     

    

 

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 Illinois 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. In addition, reversions of Employer contributions (including earnings or losses attributable thereto) are permitted
within one year after the applicable determination date, if the reversion is due to a good faith mistake of fact. The maximum amount
that may be returned to the Employer in the case of a mistake of fact or the disallowance of a deduction is the excess of (1) the
amount contributed, over, as relevant, (2) (A) the amount that would have been contributed had no mistake of fact occurred, or
(B) the amount that would have been contributed had the contribution been limited to the amount that is deductible after any disallowance
by the Internal Revenue Service. In addition, reversions of

 

    	37 

     

    

 

Employer contributions (including earnings
or losses attributable thereto) are permitted within one year after the applicable determination date, if the reversion is due
to a good faith mistake of fact.

 

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:

 

(i)         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.

 

(ii)        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:

 

(i)         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

 

(ii)        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

 

    	38 

     

    

 

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.

 

14.13   Use
of Electronic Media to Provide Notices and Make Participant Elections. Pursuant to Treasury Regulations Section 1.401(a)-21,
the Plan may elect to use electronic media to provide notices required to be provided to Participants under the Plan and will accept
elections from Participants communicated to the Plan using such electronic media.

 

14.14   Acquisition
of Securities.  Notwithstanding any other provision of the Plan to the contrary,
at no time shall the Plan be obligated to acquire securities from a particular security holder at an indefinite time determined
upon the happening of an event such as the death of the security holder, pursuant to Treasury Regulations Section 54.4975-11(a)(7)(i).

 

Section 15.      Top-Heavy
Provisions.

 

15.1     Top-Heavy
Plan. This Plan is top-heavy if any of the following conditions exist:

 

(i)         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;

 

(ii)        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

 

(iii)       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     Definitions.
In making this determination, the Committee shall use the following definitions and principles:

 

15.2-1  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

 

    	39 

     

    

 

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.

 

15.2-2  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 $165,000 (as adjusted
under section 416(i)(1) of the Code), 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.

 

15.2-3  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.

 

15.2-4  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), (c) or (m) or (o) (but only after the Code Section
414(o) regulations become effective) are considered a single Employer.

 

15.2-5  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.

 

15.3     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:

 

15.3-1  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.

 

    	40 

     

    

 

15.3-2  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.

 

15.3-3  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.

 

15.3-4  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.

 

15.3-5  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.

 

15.3-6  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 severance from employment, death, or disability, this provision
shall be applied by substituting “five (5) year period” for “one (1) year period.”

 

15.3-7  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.

 

15.3-8  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 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.

 

    	41 

     

    

 

15.4     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 such other plan.

 

15.5     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.

 

    	42

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00255-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00255-of-00352.parquet"}]]