Document:

EXHIBIT 10.19

THE WARWICK SAVINGS BANK

Bank

and

___________________________

Indemnitee

________________________________________________________

INDEMNIFICATION AGREEMENT

Dated as of                                                                                             

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TABLE OF CONTENTS

	Page

	RECITALS	1
	 	 
	ARTICLE I

CERTAIN DEFINITIONS
	 	 
	SECTION 1.1   Certain Definitions	2
	ARTICLE II

INDEMNIFICATION AND EXPENSES
	 	 
	SECTION 2.1   Indemnity Obligation	3
	SECTION 2.2   Advances for Expenses	3
	 	 
	ARTICLE III

LIMITATIONS ON INDEMNIFICATION
	 	 
	SECTION 3.1   Claims Initiated by the Indemnitee	4
	SECTION 3.2   Prohibition of Indemnification in Certain Cases	4
	 	 
	ARTICLE IV

NOTIFICATION AND DEFENSE OF CLAIM
	 	 
	SECTION 4.1   Notice and Opportunity to Participate	4
	 	 
	ARTICLE V

PROCEDURES RELATING TO INDEMNIFICATION AND EXPENSES
	 	 
	SECTION 5.1   Action by the Board of Directors	5
	SECTION 5.2   Special, Independent Legal Counsel	6
	SECTION 5.3   Expenses of Legal Counsel	6
	SECTION 5.4   Procedures for Advances for Expenses	6
	 	 

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	ARTICLE VI

ENFORCEMENT
	 	 
	SECTION 6.1   Court Action	7
	SECTION 6.2   Arbitration	7
	SECTION 6.3   Expenses of Enforcement	7
	 	 
	ARTICLE VII

MISCELLANEOUS PROVISIONS

	 	 
	SECTION 7.1   Subrogation	7
	SECTION 7.2   Reimbursement	8
	SECTION 7.3   Rights Not Exclusive	8
	 	 
	SECTION 7.4   Termination	8
	SECTION 7.5   Successors and Assigns	8
	SECTION 7.6   Severability	8
	SECTION 7.7   Waiver		8
	SECTION 7.8   Governing 1aw		9
	SECTION 7.9   Amendments	9

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INDEMNIFICATION AGREEMENT

            This Agreement is made as of	            2         , by and between The Warwick Savings
Bank, a New York State chartered mutual savings bank having its principal office at 18 Oakland
Avenue, Warwick, New York 10990 (the "Bank"), and ____________________________, residing
at _______________________________________________________ (the "Indemnitee").

RECITALS

	(A)	The Indemnitee is currently serving as a director, trustee or a trustee emeritus and/or has in
the past served as, is currently serving as, or in the future may serve as an officer, trustee,
director, partner, employee, agent, or fiduciary (a "Bank Agent") of the Bank and/or any
Other Enterprise (as defined in Article I hereof).

	(B)	
The Indemnitee is rendering valuable services to the Bank as a director, trustee, a trustee
emeritus and/or officer and desires to continue such services, provided he or she receives
assurance that the Bank will indemnify him or her to the fullest extent permitted by law
against Claims (as defined in Article I hereof) arising Out of his or her services as a Bank
Agent of the Bank or any Other Enterprise.

	(C)	The Bank desires to retain the services of the Indemnitee and is willing to provide such
assurances.

	(D)	The indemnification provisions of the New York Banking Law (the "Banking Law") and of
the Restated Organization Certificate of the Bank provide that they are not exclusive and that
agreements may be entered into by the Bank with directors, trustees and officers of the Bank
with respect to the indemnification of such persons, provided that under Section 7018 of the
Banking Law, no indemnification is permitted for any judgment or other final adjudication
adverse to the director, trustee or officer that his or her acts were committed in bad faith or
were the result of active and deliberate dishonesty and were material to the cause of action
so adjudicated, or that he or she personally gained in fact a financial profit or other advantage
to which he or she was not legally entitled; and provided further that under section 18(k) of
the Federal Deposit Insurance Act ("FDIA"), no indemnification is permitted with respect
to any final order issued in an administrative proceeding or civil action initiated by a federal
banking agency under which the Indemnitee is assessed a civil money penalty, is removed
or prohibited from participating in the conduct of the affairs of the Bank, or is required under
the FDIA to take any. affirmative action for which indemnification is prohibited by section
18(k) of the FDIA.

	(E)	In addition to the indemnification to which the Indemnitee is entitled pursuant to the Restated
Organization Certificate of the Bank, and as additional inducement for the Indemnitees
services, the Bank furnishes at its expense and may continue to furnish directors and
officers liability insurance ("D&O Insurance") protecting the Indemnitee with respect to
such service.

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	(F)	
Recent developments with respect to the cost, exclusions from coverage, and availability of
D&O Insurance and with respect to the application, amendment, and enforcement of
statutory and bylaw indemnification provisions have raised questions concerning the
adequacy and reliability of the protection afforded thereby.

	(G)	The Bank desires that the Indemnitee remain free in his or her service to the Bank or any
Other Enterprise to exercise his or her best judgment in the performance of his or her duties
without undue concern for claims for damages arising out of or related to the performance
of such duties and expenses related thereto, to the fullest extent legally permissible.

	            In order to induce the Indemnitee to continue to serve at the request of the Bank as
a Bank Agent of the Bank or any Other Enterprise, and in consideration of his or her continued
service, the Bank and the Indemnitee agree as follows:

ARTICLE I

CERTAIN DEFINITIONS

	            SECTION 1.1   Certain Definitions.

	            For purposes of this Agreement:

	            (a)     "Claim" shall mean any threatened, pending, or completed action, suit, or
proceeding, or any inquiry or investigation, whether conducted by or on behalf of the Bank or any
other party, that the Indemnitee in good faith believes might lead to the institution of any action, suit,
or proceeding, whether civil, criminal, administrative, investigative, or otherwise because of any
actual or alleged act or omission or neglect or breach of duty, including, without limitation, any
actual or alleged error or misstatement or misleading statement or action or inaction, of the
Indemnitee while acting as a Bank Agent on behalf of the Bank or any Other Enterprise.

	            (b)     "Expenses" shall include fees of attorneys, accountants and experts, and all
other costs, expenses and obligations paid or incurred in connection with investigating, defending,
being a witness in or participating in (including on appeal), or preparing to defend, be a witness in
or participate in any Claim relating to any actual or alleged act or omission or neglect or breach of
duty, including, without limitation, any actual or alleged error or misstatement or misleading
statement or action or inaction, of the Indemnitee while acting as a Bank Agent on behalf of the Bank
or any Other Enterprise.

	            (c)     "Losses" shall include any judgment (including, without limitation, a
judgment for punitive damages), civil money penalty, fine, excise tax (including any excise tax
arising under the Employee Retirement Income Security Act of 1974, as amended, assessed on the
Indemnitee with respect to any employee benefit plan), costs of attachment or similar bonds and
amount paid in settlement (including all interest, assessments and other charges paid or payable in
connection with or in respect of such judgment, penalty, fine, excise tax, or amount paid in
settlement) of such Claim.

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            (d)     "Other Enterprise" shall mean any corporation (including any corporation now
or hereafter owned, whether wholly or partially, directly or indirectly, by the Bank), holding
company (including a mutual holding company) that owns an interest in the Bank, partnership, joint
venture, employee benefit plan, trust or other enterprise, whether or not formed under the laws of
New York, to which the Indemnitee renders service as a Bank Agent at the request of the Bank.

ARTICLE II

INDEMNIFICATION AND EXPENSES

	            SECTION 2.1   	Indemnity Obligation.

	            The Bank agrees to hold harmless and indemnify the Indemnitee for any amount that
the Indemnitee is or becomes legally obligated to pay because of any Claim against him or her with
respect to his or her service as a Bank Agent of the Bank or any Other Enterprise. Such
indemnification and hold harmless obligation shall apply to the fullest extent permitted under the
Banking Law, any amendment thereof, or any other statutory provision permitting such
indemnification, whether presently in effect or adopted after the date hereof (but, in the case of any
such subsequent amendment, only to the extent that such amendment permits the Bank to provide
broader indemnification rights than the Banking Law permitted the Bank to provide as of the date
of this Agreement). The payments that the Bank shall be obligated to make hereunder shall include,
without limitation, all Expenses and Losses incurred by the Indemnitee in connection with the
investigation, defense, settlement, or satisfaction of any Claim.  If the Indemnitee is entitled to
indemnification for part, but not all, of a Claim, the Bank agrees to hold harmless and indemnify the
Indemnitee for such portion of the Claim to the fullest extent permitted under the Banking Law as
set forth above.  Notwithstanding any other provision of this Agreement to the contrary, to the extent
the Indemnitee has been successful on the merits or otherwise in defense of any or all Claims or in
defense of any issue or matter related thereto, including dismissal without prejudice, the Indemnitee
shall be indemnified against all Expenses incurred in connection therewith, whether or not directly
related to the Claim entitling Indemnitee to such indemnification.

	            SECTION 2.2   	Advances for Expenses.

		If the Indemnitee is, was, or becomes a participant in any Claim by reason of (or
arising in part out of) any actual or alleged act or omission or neglect or breach of duty, including,
without limitation, any actual or alleged act or omission or neglect or breach of duty, including,
without limitation, any actual or alleged error or misstatement or misleading statement or action or
inaction, of the Indemnitee while acting as a Bank Agent on behalf of the Bank or any Other
Enterprise, the Bank shall advance any and all Expenses to the Indemnitee as provided by Section
5.4 hereof if so requested by the Indemnitee.

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ARTICLE III

LIMITATIONS ON INDEMNIFICATION

            	SECTION 3.1   	Claims Initiated by the Indemnitee.

            	Notwithstanding anything contained herein to the contrary, except as provided in
Article VT with respect to enforcement of the Indemnitees rights to indemnification, the Bank shall
indemnify the Indemnitee in connection with any action, suit, or proceeding initiated by the
Indemnitee only if such action, suit, or proceeding was authorized by the Board of Directors of the
Bank (the "Board").

	            SECTION 3.2    Prohibition of Indemnification in Certain Cases.

	            No indemnification is permitted or will be paid by the Bank under this Agreement
if and to the extent prohibited by applicable law.

ARTICLE IV

NOTIFICATION AND DEFENSE OF CLAIM

            	SECTION 4.1 	Notice and Opportunity to Participate.

	            The Indemnitee shall give the Bank notice in writing as soon as practicable of any
Claim. Notice to the Bank shall be directed to the Corporate Secretary, The Warwick Savings Bank,
18 Oakland Avenue, Warwick, New York 10990 (or such other address as the Bank shall designate
in writing to the Indemnitee). Failure of the Indemnitee to give such notice shall not relieve the Bank
of its obligations hereunder, except to the extent the Bank is actually damaged as a result thereof.

            With respect to a Claim of which the Bank is so notified:

            	(a)  the Bank will be entitled to participate therein at its own expense, including, but
not limited to, participating in any settlement discussions or proceedings; and

            	(b)  except as otherwise provided below in this Section 4.1, the Bank will be entitled
to assume the defense thereof, with legal counsel reasonably acceptable to the Indemnitee.

            	After notice from the Bank to the Indemnitee of its election to assume such defense,
the Bank shall not be liable to the Indemnitee under this Agreement for any Expenses subsequently
incurred by the Indemnitee in connection with such Claim, other than reasonable costs of
investigation or as otherwise provided below in this Section 4.1. The Indemnitee shall have the right
to employ his or her own counsel in such Claim but the Expenses of such counsel incurred after
notice from the Bank of its assumption of the defense thereof shall be at the expense of the
Indemnitee unless (i) the employment of counsel by the Indemnitee has been authorized by the Bank,
(ii) counsel to the Indemnitee shall have concluded that there may be a conflict of interest or position

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on any issue between the Bank and the Indemnitee in the conduct of the defense of such action and
shall have rendered an opinion to that effect to the Indemnitee and the Bank, or (iii) the Bank shall
not in fact have employed counsel to assume the defense of such Claim within ten days of its receipt
of notice from the Indemnitee; in each of which cases the Expenses of counsel for the Indemnitee
shall be paid by the Bank. The Bank shall not be entitled to assume the defense of any Claim brought
by or on behalf of the Bank or as to which counsel for the Indemnitee shall have rendered an opinion
as provided for in (ii) above.

ARTICLE V

PROCEDURES RELATING TO INDEMNIFICATION AND EXPENSES

	            SECTION 5.1    Action by the Board of Directors.

	            For purposes of obtaining indemnification under Section 2.1, the Indemnitee shall (i)
submit to the Board a sworn statement of request for indemnification substantially in the form of
Exhibit A attached hereto and made a part hereof (the "Indemnification Statement") stating that he
or she is entitled to indemnification hereunder; and (ii) present to the Board reasonable evidence of
all amounts for which indemnification is requested. Submission of an Indemnification Statement to
the Board shall create a presumption that the Indemnitee is entitled to indemnification hereunder,
and the Bank shall, within forty-five calendar days after submission of the Indemnification
Statement, make the payments requested in the Indemnification Statement to or for the benefit of the
Indemnitee, unless:

	            (a)   within such forty-five calendar day period, a majority vote of a quorum
consisting of Board members who were not and are not parties to or threatened with such
action, suit, or proceeding ("Disinterested Board Members") shall resolve by vote that the
Indemnitee is not entitled to indemnification, on the basis of clear and convincing evidence
(sufficient to rebut the presumption that the Indemnitee is entitled to indemnification), and
the Indemnitee shall have received within such period notice in writing of such vote, which
notice shall disclose with particularity the facts upon which the vote is based and which
notice shall identify all persons who participated in the vote and those who voted to deny
indemnification; or

            	(b)   within such forty-five calendar day period, where a quorum of Disinterested
Board Members is not obtainable or if a majority of such quorum so directs, independent
legal counsel (retained by the Board for such purpose) that shall not be an attorney or a firm
having associated with it an attorney who has been retained by or who has performed
services for the Bank or the Indemnitee at any time within the five years preceding its
selection as independent legal counsel, shall determine that the Indemnitee is not entitled to
indemnification and shall provide a written opinion of its determination to that effect to the
Bank and the Indemnitee.

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            	SECTION 5.2	   Special, Independent Legal Counsel.

	            Notwithstanding the provisions of Section 5.1, if a determination has been made that
the Indemnitee is not entitled to indemnification in whole or in part by the Board pursuant to Section
5.1(a) or independent legal counsel pursuant to Section 5.1(b), the Indemnitee may submit the
determination to a court or to binding arbitration pursuant to Article VI hereof. Alternatively, he or
she may first elect to submit the Indemnification Statement to special, independent legal counsel who
shall, among other things, determine whether and to what extent the Indemnitee is permitted to be
indemnified under this Agreement and shall render its written opinion to that effect to the Bank and
the Indemnitee, in which case the Indemnitee shall be entitled to indemnification as determined by
such counsel. The special, independent legal counsel shall be chosen by the Bank from among three
law firms in the counties of Albany, Westchester, Orange, or Rockland, New York, selected by the
Indemnitee, having more than 10 attorneys and having a rating of "av" in the then current
Martingale-Hubbell Law Directory that shall not have been retained by or performed services for the
Bank or the Indemnitee at any time within the five year period preceding its selection as special,
independent legal counsel. The Bank shall choose one of the three law firms by lot, and such
selection shall be made in the presence of the Indemnitee.

	            SECTION 5.3    Expenses of Legal Counsel.

	            The Expenses of independent legal counsel pursuant to Section 5.1(b), or special,
independent legal counsel pursuant to Section 5.2, in connection with making any determination
contemplated under either section (irrespective of the determination as to the Indemnitees
entitlement to indemnification) shall be paid by the Bank.

            	SECTION 5.4    Procedures for Advances for Expenses.

            	For purposes of obtaining payments of Expenses in advance of final disposition of
a Claim, the Indemnitee shall submit to the Bank a sworn request for advancement of Expenses
substantially in the form of Exhibit B attached hereto and made a part hereof (the "Undertaking"),
stating that he or she has incurred Expenses in defending a Claim. By executing the Undertaking,
the Indemnitee undertakes (1) to repay such amount if it ultimately is determined that he or she is
not entitled to be indemnified by the Bank under this Agreement or otherwise, and (2) to cooperate
with the Bank concerning the Claim. Expenses that are paid by the Bank pursuant to the Undertaking
shall be required to be repaid by the Indemnitee as provided in the Undertaking. Upon receipt of the
Undertaking, the Bank shall thereafter promptly pay such Expenses of the Indemnitee as are noticed
to the Bank in writing and in detail arising out of the matter described in the Undertaking. No
security shall be required in connection with any Undertaking.

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ARTICLE VI

ENFORCEMENT

            	SECTION 6.1   	Court Action.

            	If: (1) a determination has been made that the Indemnitee would not be permitted to
be indemnified in whole or in part by the Board pursuant to Section 5.1(a), by the independent legal
counsel pursuant to Section 5.1(b), or by special, independent legal counsel pursuant to Section 5.2;
(2) advances of Expenses are not made upon request pursuant to this Agreement; (3) payment has
not been timely made following a determination of entitlement to indemnification pursuant to this
Agreement; or (4) the Indemnitee otherwise seeks enforcement of this Agreement, the Indemnitee
shall have either the right to commence litigation in any court in the State of New York having
subject matter jurisdiction thereof and in which venue is proper seeking an order or judgment by the
court of the remedy sought or request arbitration of the dispute pursuant to Section 6.2 below.

            	SECTION 6.2   		Arbitration.

	            If arbitration is requested under Section 6.1 above, such arbitration shall be initiated
by the Indemnitee and shall be submitted to binding arbitration before three arbitrators in the
counties of Albany, Westchester, Orange, or Rockland, New York for expedited arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration Association, and any
judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction
thereof. For the purposes of this Agreement, the arbitration shall be conducted de novo and without
prejudice by reason of any prior determination to the effect that the Indemnitee is not entitled to
indemnification for Expenses or Losses.

	            	SECTION 6.3    	Expenses of Enforcement.

	            	The Bank shall indemnify, hold harmless and defend the Indemnitee against (and
reimburse him or her for) reasonable Expenses incurred by him or her in connection with his or her
consultation with legal counsel or arising out of any action, suit, or proceeding in which he or she
may be involved, as a result of his or her efforts, in good faith, to defend or enforce the terms of this
Agreement.

ARTICLE VII

MISCELLANEOUS PROVISIONS

	            	SECTION 7.1    	Subrogation.

	            	In the event of payment under this Agreement, the Bank shall be subrogated to the
extent of such payment to all of the rights of recovery of the Indemnitee (including, without
limitation, all rights to indemnification or reimbursement against any insurer or other entity or person
vested in the Indemnitee). The Indemnitee agrees to execute all papers required and shall do

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everything that may be necessary to secure such rights, including the execution of such documents
necessary to enable the Bank effectively to bring suit to enforce such rights.

	            	SECTION 7.2    	Reimbursement.

	            	The Bank shall not be liable under this Agreement to make any payment in
connection with any Claim made against an Indemnitee to the extent that the Indemnitee has actually
received payment (under any insurance policy, the Restated Organization Certificate or otherwise)
of amounts otherwise indemnifiable hereunder.

	            	SECTION 7.3    	Rights Not Exclusive.

	            	The rights to indemnification provided by this Agreement shall not be exclusive of
any other rights of indemnification to which the Indemnitee may be entitled under the Restated
Organization Certificate, the Banking Law or any other statute, any insurance policy, agreement, vote
of Board members, or opinion of independent legal counsel or otherwise.

	            	SECTION 7.4    	Termination.

	            	This Agreement shall continue until and terminate upon the later of (i) the tenth
anniversary after the Indemnitee has ceased to occupy any of the positions or have any of the
relationships described in Section 2.1 of this Agreement, or (ii) the final termination or resolution
of all proceedings with respect to the Indemnitee commenced during such 10 year period.

            		SECTION 7.5 	   Successors and Assigns.

	            	This Agreement shall be binding upon the successors and assigns of the Bank,
whether by operation of law or otherwise, including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Bank,
and shall inure to the benefit of the heirs, distributees, assigns, and personal and legal representatives
of the Indemnitee.

            		SECTION 7.6    	Severability.

	            	If any provision of this Agreement or the application of any provision hereof to any
person or circumstances is held invalid, unenforceable, or otherwise illegal, the remainder of this
Agreement and the application of such provision to other persons or circumstances shall not be
affected, and the provisions so held to be invalid, unenforceable, or otherwise illegal shall be
reformed to the extent (and only to the extent) necessary to make it enforceable, valid, and legal.

	            	SECTION 7.7 	Waiver.

            		Failure to insist upon strict compliance with any of the terms, covenants or conditions
hereof shall not be deemed a waiver of such term, covenant or condition. A waiver of any provision
of this Agreement must be made in writing, designated as a waiver, and signed by the party against
whom its enforcement is sought. Any waiver or relinquishment of any right or power hereunder at

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any one or more times shall not be deemed a waiver or relinquishment of such right or power at any
other time or times.

	            	SECTION 7.8    	Governing Law.

            		This Agreement shall be governed by and construed in accordance with the laws of
the State of New York, without reference to conflict of laws principles.

            		SECTION 7.9    	Amendments.

            		This Agreement shall not be amended, modified or terminated except by written
instrument signed by the parties hereto.

	            	IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.

		THE WARWICK SAVINGS BANK

		By 	 

Name:  Fred G. Kowal

Title:    Chief Executive Officer

		INDEMNITEE

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	STATE OF NEW YORK		)	
		)  ss:	
	COUNTY OF	)	

	            On this _____ day of _______________, 2____, before me personally came
___________________, to me known, who, being duly sworn, did depose and say that he resides
at _____________________________________; that he is a [Title]__________________________
of The Warwick Savings Bank, the Bank described in and which executed the above instrument; that
he knows the seal of said Bank; that the seal affixed to said instrument is such Banks seal; that it
was so affixed by order of the Board of Directors of said Bank, and that he signed his name thereto
by like order.

		

Notary Public

	STATE OF NEW YORK		)	
		)  ss:	
	COUNTY OF	)	

	            	On this _____ day of ______________, 2_____, before me personally came
_____________________, to me known and known to me to be the individual described in and who
executed the foregoing instrument, and he duly acknowledged that he executed the same.

		

Notary Public

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INDEMNIFICATION STATEMENT

Exhibit A

	State of 		)	
		)  ss:	
	County of	)	

            	I, ____________________, being first duly sworn, do depose and say as follows:

            	1.   	This Indemnification Statement is submitted pursuant to the Indemnification
Agreement made as of the _____ day of ____________, 2____, between The Warwick Savings Bank
(the "Bank"), and the undersigned.

            	2.   	I am requesting indemnification against costs, charges, expenses (that may include
fees and expenses of attorneys and/or others), judgments, fines, and amounts paid in settlement
(collectively, "Expenses and Losses"), that have been actually incurred by me in connection with a
Claim referred to in Section 2.1 of the aforesaid Agreement.

            	3.   	With respect to all matters related to any such Claim, I am entitled to be indemnified
as herein contemplated pursuant to the aforesaid Agreement.

	            4.   	Without limiting any other rights that I have or may have, I am requesting
indemnification against Expenses and Losses that have or may arise out of ___________________________________________________________________________.

		

[Signature of Indemnitee]

	            Subscribed and sworn to before me, a Notary Public in and for said County and State, this
______ day of ___________, 2____.

[Seal]

My commission expires the ______ day of ______________, 2____.

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UNDERTAKING

	Exhibit B

	State of 		)	
		)  ss:	
	County of	)	

            	I, ____________________, being first duly sworn do depose and say as follows:

            	1.   	This Undertaking is submitted pursuant to the Indemnification Agreement made as
of the ______ day of _______________,  2____, between The Warwick Savings Bank (the "Bank"),
and the undersigned.

            	2.   	I am requesting payment of costs, charges, and expenses that I have incurred or will
incur in defending the Claim referred to in Section 2.1 of the aforesaid Agreement.

            	3.   	The costs, charges, and expenses for which payment is requested are, in general, all
expenses related to ________________________________________________________________________________.

	            4.   	I hereby undertake to (1) repay all amounts paid pursuant hereto if it ultimately is
determined that I am not entitled to be indemnified by the Bank under the aforesaid Agreement or
otherwise, and (2) reasonably cooperate with the Bank concerning the Claim.

		

[Signature of Indemnitee]

	            Subscribed and sworn to before me, a Notary Public in and for said County and State, this
______ day of ___________, 2____.

[Seal]

My commission expires the ______ day of ______________, 2____.EXHIBIT 10.2

EMPLOYMENT AGREEMENT

              	THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of this 
1st day of January 2004 by and between Mutual Federal Savings Bank (hereinafter referred to as the
"Bank"), MutualFirst Financial, Inc. (the "Company") and Patrick C.  Botts (the "Employee").

              	WHEREAS, the Employee is currently serving as President and Chief Operating Officer of
the Bank and Executive Vice President of the Company; and

              	WHEREAS, the Board of Directors of the Bank believes it is in the best interests of the Bank
to enter into this Agreement with the Employee in order to assure continuity of management of the
Bank and to reinforce and encourage the continued attention and dedication of the Employee; and

              	WHEREAS, the Board of Directors of the Company has approved and authorized the
execution of this Agreement for the purpose of the Company making the guarantee set forth in
Section 18; and

              	WHEREAS, the Board of Directors of the Bank has approved and authorized the execution
of this Agreement with the Employee to take effect as stated in Section 2 hereof.

              	NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and
agreements of the parties herein, it is AGREED as follows:

              	1.              	Definitions.

                            (a)               The term "Change in Control" means (1) an event of a nature that (i)
results in a change in control of the Bank or the Company within the meaning of the Home Owners'
Loan Act of 1933 and 12 C.F.R. Part 574 as in effect on the date hereof; or (ii) would be required
to be reported in response to Item I 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"); (2)
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 Bank or the Company representing 20% or more of the Bank's or the Company's
outstanding securities; (3) individuals who are members of the board of directors of the Bank or the
Company 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
nominating committee serving under an Incumbent Board, shall be considered a member of the
Incumbent Board; or (4) a reorganization, merger, consolidation, sale of all or substantially all of the
assets of the Bank or the Company or a similar transaction in which the Bank or the Company is not
the resulting entity. The term "Change in Control" shall not include an acquisition of securities by
an employee benefit plan of the Bank or the Company. In the application of 12 C.F.R. Part 574 to

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a determination of a Change in Control, determinations to be made by the OTS or its Director under
such regulations shall be made by the Board of Directors.

                            (b)               The term "Commencement Date" means January 1, 2004.

                            (c)               The term "Date of Termination" means the date upon which the Employee
ceases to serve as an employee of the Bank.

                            (d)               The term "Involuntarily Termination" means termination of the
employment of Employee without the Employee's express written consent, and shall include a
material diminution of or interference with the Employee's duties, responsibilities and benefits as
President and Chief Operating Officer of the Bank and Executive Vice President of the Company,
including (without limitation) any of the following actions unless consented to in writing by the
Employee: (1) a change in the principal workplace of the Employee to a location outside of a 30 mile
radius from the Bank's headquarters office as of the date hereof, (2) a material demotion of the
Employee; (3) a material reduction in the number or seniority of other Bank personnel reporting to
the Employee or a material reduction in the frequency with which, or in the nature of the matters
with respect to which, such personnel are to report to the Employee, other than as part of a Bank-
or Company-wide reduction in staff, (4) a material adverse change in the Employee's salary,
perquisites, benefits, contingent benefits or vacation, other than as part of an overall program applied
uniformly and with equitable effect to all members of the senior management of the Bank or the
Company; and (5) a material permanent increase in the required hours of work or the workload of
the Employee. The term "Involuntary Termination" does not include Termination for Cause or
termination of employment due to retirement, death, disability or suspension or temporary or
permanent prohibition from participation in the conduct of the Bank's affairs under Section 8 of the
Federal Deposit Insurance Act ("FDIA").

                            (e)               The terms "Termination for Cause" and "Terminated For Cause" mean
termination of the employment of the Employee because of the Employee's personal dishonesty,
incompetence, willful misconduct, breach of a fiduciary duty involving personal profit, intentional
failure to perform stated duties, willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order, or material breach of any provision
of this Agreement. The Employee shall not be deemed to have been Terminated for Cause unless and
until there shall have been delivered to the Employee a copy of a resolution, duly adopted by the
affirmative vote of not less than a majority of the entire membership of the Board of Directors of the
Bank at a meeting of the Board called and held for such purpose (after reasonable notice to the
Employee and an opportunity for the Employee, together with the Employee's counsel, to be heard
before the Board), stating that in the good faith opinion of the Board the Employee has engaged in
conduct described in the preceding sentence and specifying the particulars thereof in detail.

              2.              Term. The term of this Agreement shall be a period of three years beginning on the
Commencement Date, subject to earlier termination as provided herein. Beginning on the first
anniversary of the Commencement Date, and on each anniversary thereafter, the term of this

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Agreement shall be extended for a period of one year in addition to the then-remaining term,
provided that (1) the Bank has not given notice to the Employee in writing at least 90 days prior to
such anniversary that the term of this Agreement shall not be extended further; and (2) prior to such
anniversary, the Board of Directors of the Bank explicitly reviews and approves the extension.
Reference herein to the term of this Agreement shall refer to both such initial term and such extended
terms.

              3.              	Employment. The Employee is employed as President and Chief Operating Officer
of the Bank and Executive Vice President of the Company as of the Commencement Date. As such,
the Employee shall render administrative and management services as are customarily performed
by persons situated in similar executive capacities, and shall have such other powers and duties of
an officer of the Bank and the Company as the Board of Directors may prescribe from time to time.

              4.              Compensation.

                            (a)               Salary. The Bank agrees to pay the Employee during the term of this
Agreement, not less frequently than monthly, the salary established by the Board of Directors, which
shall be at least $150,000 annually.  The amount of the Employee's salary shall be reviewed by the
Board of Directors, beginning not later than the first anniversary of the commencement Date.
Adjustments in salary or other compensation shall not limit or reduce any other obligation of the
Bank or of the Company under this Agreement.  The Employee's salary in effect from time to time
during the term of this Agreement shall not thereafter be reduced.

                            (b)              Discretionary Bonuses. The Employee shall be entitled to participate in
an equitable manner with all other executive officers of the Bank in discretionary bonuses as
authorized and declared by the Board of Directors to its executive employees. No other
compensation provided for in this Agreement shall be deemed a substitute for the Employee's right
to participate in such bonuses when and as declared by the Board of Directors.

                            (c)              Expenses. The Employee shall be entitled to receive prompt
reimbursement for all reasonable expenses incurred by the Employee in performing services under
this Agreement in accordance with the policies and procedures applicable to the executive officers
of the Bank, provided that the Employee accounts for such expenses as required under such policies
and procedures.

              5.              	Benefits.

                            (a)              Participation in Retirement and Employee Benefit Plans. The Employee
shall be entitled to participate in all plans relating to pension, thrift, profit-sharing, group life and
disability insurance, medical and dental coverage, education, cash bonuses, and other retirement or
employee benefits or combinations thereof, in which the Bank's executive officers participate.

                            (b)              Fringe Benefits. The Employee shall be eligible to participate in, and

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receive benefits under, any fringe benefit plans which are or may become applicable to the Bank's
executive officers, including, without limitation, the Company's Stock Option Plan and Management
Recognition Plan.

              6.              	Vacations; Leave. The Employee shall be entitled to annual paid vacation in
accordance with the policies established by the Board of Directors for executive employees and to
voluntary leave of absence, with or without pay, from time to time at such times and upon such
conditions as the Board of Directors may determine in its discretion.

              7.              	Termination of Employment.

                            (a)               Involuntary Termination. The Board of Directors may terminate the
Employee's employment at any time, but, except in the case of Termination for Cause, termination
of employment shall not prejudice the Employee's right to compensation or other benefits under this
Agreement. In the event of Involuntary Termination other than in connection with or within twelve
(12) months after a Change in Control, (1) the Bank shall pay to the Employee during the remaining
term of this Agreement, the Employee's salary at the rate in effect immediately prior to the Date of
Termination, payable in such manner and at such times as such salary would have been payable to
the Employee under Section 4 if the Employee had continued to be employed by the Bank, and (2)
the Bank shall provide to the Employee during the remaining term of this Agreement substantially
the same benefits as the Bank maintained for its executive officers immediately prior to the Date of
Termination, including Bank-paid dependent medical and dental coverage.

                            (b)               Termination for Cause. In the event of Termination for Cause, the Bank
shall pay the Employee the Employee's salary and benefits through the Date of Termination, and the
Bank shall have no further obligation to the Employee under this Agreement.

                            (c)               Voluntary Termination. The Employee's employment may be voluntarily
terminated by the Employee at any time upon 90 days written notice to the Bank or upon such shorter
period as may be agreed upon between the Employee and the Board of Directors. In the event of such
voluntary termination, the Bank shall be obligated to continue to pay to the Employee the
Employee's salary and benefits only through the Date of Termination, at the time such payments are
due, and the Bank shall have no further obligation to the Employee under this Agreement.

                            (d)               Change in Control. In the event of Involuntary Termination in connection
with or within 12 months after a Change in Control which occurs at any time while the Employee
is employed under this Agreement, the Bank shall, subject to Section 8 of this Agreement, (1) pay
to the Employee in a lump sum in cash within 25 business days after the Date of Termination an
amount equal to 299% of the Employee's "base amount" as defined in Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"); and (2) provide to the Employee during the
remaining term of this Agreement substantially the same health benefits as the Bank maintained for
its executive officers immediately prior to the Change in Control.

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                            			(e)               Death;  Disability. In the event of the death of the Employee while
employed under this Agreement and prior to any termination of employment, the Employee's estate,
or such person as the Employee may have previously designated in writing, shall be entitled to
receive from the Bank the salary and benefits of the Employee through the last day of the calendar
month in which the Employee died. If the Employee becomes disabled as defined in the Bank's then
current disability plan, if any, or if the employee is otherwise unable to serve in his current capacity,
this Agreement shall continue in fall force and effect, except that the salary paid to the Employee
shall be reduced by any disability insurance payments made to Employee on policies of insurance
maintained by the Bank at its expense.

                            (f)               Temporary Suspension or Prohibition. If the Employee is suspended and/or
temporarily prohibited from participating in the conduct of the Bank's affairs by a notice served
under Section 8(e)(3) or (g)(1) of the FDIA, 12 U.S.C. § 1818(e)(3) and (g)(1), the Bank's
obligations under this Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the Bank may in its discretion
(i) pay the Employee all or part of the compensation withheld while its obligations under this
Agreement were suspended and (ii) reinstate in whole or in part any of its obligations which were
suspended.

                            (g)               Permanent Suspension or Prohibition. If the Employee is removed and/or
permanently prohibited from participating in the conduct of the Bank's affairs by an order issued
under Section 8(e)(4) or (g)(1) of the FDIA, 12 U.S.C. § 1818(e)(4) and (g)(1), all obligations of the
Bank under this Agreement shall terminate as of the effective date of the order, but vested rights of
the contracting parties shall not be affected.

                            (h)               Default of the Bank. If the Bank is in default (as defined in Section 3(x)(1)
of the FDIA), all obligations under this Agreement shall terminate as of the date of default, but this
provision shall not affect any vested rights of the contracting parties.

                            (i)               Termination by Regulators. All obligations of the Bank under this
Agreement shall be terminated, except to the extent determined that continuation of this Agreement
is necessary for the continued operation of the Bank: (1) by the Director of the Office of Thrift
Supervision (the "Director") or his or her designee, at the time the Federal Deposit Insurance
Corporation enters into an agreement to provide assistance to or on behalf of the Bank under the
authority contained in Section 13(c) of the FDIA; or (2) by the Director or his or her designee, at the
time the Director or his or her designee approves a supervisory merger to resolve problems related
to operation of the Bank or when the Bank is determined by the Director to be in an unsafe or
unsound condition. Any rights of the parties that have already vested, however, shall not be affected
by any such action.

              	8.               	Certain Reduction of Payments by the Bank.

                            (a)               Notwithstanding any other provision of this Agreement, if payments under

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this Agreement, together with any other payments received or to be received by the Employee in
connection with a Change in Control would cause any amount to be nondeductible for federal
income tax purposes pursuant to Section 280G of the Code, then benefits under this Agreement shall
be reduced (not less than zero) to the extent necessary so as to maximize payments to the Employee
without causing any amount to become nondeductible. The Employee shall determine the allocation
of such reduction among payments to the Employee.

                            (b)               Any payments made to the Employee pursuant to this Agreement, or
otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. § 1828(k) and any
regulations promulgated thereunder.

              9.               	No Mitigation. The Employee shall not be required to mitigate the amount of any
salary or other payment or benefit provided for in this Agreement by seeking other employment or
otherwise, nor shall the amount of any payment or benefit provided for in this Agreement be reduced
by any compensation earned by the Employee as the result of employment by another employer, by
retirement benefits after the Date of Termination or otherwise.

              10.               	Attorneys Fees. In the event the Bank exercises its right of Termination for Cause,
but it is determined by a court of competent jurisdiction or by an arbitrator pursuant to Section 17
that cause did not exist for such termination, or if in any event it is determined by any such court or
arbitrator that the Bank has failed to make timely payment of any amounts owed to the Employee
under this Agreement, the Employee shall be entitled to reimbursement for all reasonable costs,
including attomeys'fees, incurred in challenging such termination or collecting such amounts. Such
reimbursement shall be in addition to all rights to which the Employee is otherwise entitled under
this Agreement.

              11.               	No Assignments.

                            (a)               This Agreement is personal to each of the parties hereto, and no party may
assign or delegate any of its rights or obligations hereunder without first obtaining the written
consent of the other party; provided, however, that the Bank shall require any successor or assign
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially
all of the business and/or assets of the Bank, by an assumption agreement in form and substance
satisfactory to the Employee, to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Bank would be required to perform it if no such succession
or assignment had taken place. Failure of the Bank to obtain such an assumption agreement prior to
the effectiveness of any such succession or assignment shall be a breach of this Agreement and shall
entitle the Employee to compensation from the Bank in the same amount and on the same terms as
the compensation pursuant to Section 7(d) hereof. For purposes of implementing the provisions of
this Section I I (a), the date on which any such succession becomes effective shall be deemed the
Date of Termination.

                            (b)               This Agreement and all rights of the Employee hereunder shall inure to

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the benefit of and be enforceable by the Employee's personal and legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If the Employee should die
while any amounts would still be payable to the Employee hereunder if the Employee had continued
to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to the Employee's devisee, legatee or other designee or if there is no such
designee, to the Employee's estate.

              12.               	Notice. For the purposes of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and, shall be deemed to have been duly given when
personally delivered or sent by certified mail, return receipt requested, postage prepaid, to the Bank
or Company at its home office, to the attention of the Board of Directors with a copy to the
Secretary, or, if to the Employee, to such home or other address as the Employee has most recently
provided in writing to the Bank.

              13.               	Amendments. No amendments or additions to this Agreement shall be binding unless
in writing and signed by both parties, except as herein otherwise provided.

              14.               	Headings. The headings used in this Agreement are included solely for convenience
and shall not affect, or be used in connection with, the interpretation of this Agreement.

              15.               	Severability. The provisions of this Agreement shall be deemed severable and the
invalidity or unenforceability of any provision shall not affect the validity or enforceability of the
other provisions hereof.

              16.               	Governing Law. This Agreement shall be governed by the laws of the United States
to the extent applicable and otherwise by the laws of the State of Indiana.

              17.               	Arbitration. Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered on the arbitrator's award in any
court having jurisdiction.

              18.              	 Company Guarantee. The Company hereby guarantees the obligations of the Bank
to the Employee under the Employment Agreement. This guarantee shall be subject to the provisions
of 12 U.S.C. Section 1828(k) and regulations thereunder.

              19.              	Supercedes Prior Agreements.  This Agreement supercedes any and all prior
employment agreements entered into by and between the Employee, the Bank or the Company.

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              	IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year
first above written.

              	THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH
MAY BE ENFORCED BY THE PARTIES.

	Attest:

	 MUTUAL FEDERAL SAVINGS BANK
	
/s/ Rosalie Petro
Secretary	/s/ David W. Heeter

By: David W. Heeter
Its: Chief Executive Officer

	
Attest:	MUTUALFIRST FINANCIAL INC.
	
/s/ Rosalie Petro
Secretary	/s/ David W. Heeter

By: David W. Heeter
Its: Chief Executive Officer

		EMPLOYEE

							/s/ Patrick C. Botts

							Patrick C. Botts

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End.

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