Document:

EXHIBIT 10.7

 Exhibit 10.7 
  

	 EMPLOYEE STOCK OWNERSHIP PLAN
 OF
 AF BANK
	 	 AMENDMENT NO. 3
  

	 	DOCUMENT:	 	TPW/WA01/3126187
	 	DRAFT DATE:	 	04/01/02
	 	 	 	 	 	 	 
	Adopted on September 10, 1996 Effective on July 1, 1996	 	BOARD OF DIRECTORS	 	 
	 	 	 	 	APPROVAL DATE:	 	4/15/02

  
 AMENDMENT

  

	1.	 	Section 8.2 - Subparagraph 8.2(a) shall be amended, effective January 1, 2002, to read in its entirety as follows: 

  
 (a) Notwithstanding any other provisions of the Plan, no amount shall be
allocated to a Participant’s Account for any Limitation Year to the extent that such allocation would result in an Annual Addition of an amount exceeding: 
  

(i) for Limitation Years beginning before January 1, 2002, the lesser of (A) $30,000 (or such other amount as is permissible under
section 415(c)(1)(A) of the Code), or (ii)(B) twenty-five percent (25%) of the Participant’s Total Compensation paid during such Limitation Year; and 
  
 (ii) for Limitation Years beginning after December 31, 2001, the lesser of (A) $40,000 (or such other amount as is permissible under
section 415(c)(1)(A) of the Code), or (B) one hundred percent (100%) of the Participant’s Total Compensation paid during such Limitation Year. 
  

	2.	 	Section 8.2 - Subparagraph 8.2(c)(i) of the Plan shall be amended, effective as of January 1, 2002, to include a new sentence at the end thereof which shall read in its entirety as
follows: 

  
 In Limitation Years beginning after
December 31, 2001, catch-up elective deferrals under section 414(v) of the Code shall not be included as Annual Additions. 
  

	3.	 	Section 12.2 - Subsection 12.2(b) of the Plan shall be amended, effective as of January 1, 2002, to read in its entirety as follows: 

  
 (b) Dividends paid with respect to Shares allocated to a
person’s Share Investment Account shall be credited to such person’s Share Investment Account. Cash dividends credited to a person’s General Investment Account shall be, at the direction of the Committee, either: (i) held in such
General Investment Account and invested in accordance with sections 10.2 and 11.3; (ii) distributed immediately to such person; (iii) distributed to such person within 90 days of the close of the Plan Year in which such dividends were paid; (iv)
used 

 
to make payments of principal or interest on a Share Acquisition Loan; provided, however, that the Fair Market Value of Financed Shares released from the
Loan Repayment Account as a result of such payment equals or exceeds the amount of the dividend; or (v) in calendar years beginning after December 31, 2001 either held as provided in section 12.2(b)(i) or distributed as provided in section
12.2(b)(ii), as each person shall elect for his own Account. 
  

	4.	 	Section 13.6 - Subsections 13.6(c)(iii) and (iv) of the Plan shall be amended, effective as of January 1, 2002, to read in their entirety as follows: 

  
 (iii) “Eligible Retirement Plan” means an
individual retirement account described in section 408(a) of the Code, an individual retirement annuity described in section 408(b) of the Code, an annuity plan described in section 403(a) of the Code, or a qualified trust described in section
401(a) of the Code, and (for distributions after December 31, 2001 only) an annuity contract described in section 403(b) of the Code or an eligible deferred compensation plan under section 457(b) of the Code which is maintained by a state, political
subdivision of a state, or an agency or instrumentality of a state or political subdivision thereof and which agrees to separately account for amounts transferred into such plan from this Plan, that accepts the distributee’s eligible rollover
distribution. However, in the case of an eligible rollover distribution made before January 1, 2002 to a current or former spouse who is the alternate payee under a qualified domestic relations order as defined in Code section 414(p) or to a
surviving spouse, an eligible retirement plan is only an individual retirement account or individual retirement annuity. 
  
 (iv) “Eligible Rollover Distribution” means any distribution of all or any portion of the balance to the credit of the
distributee, except that an eligible rollover distribution 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 distributee and the distributee’s designated Beneficiary, or for a specified period of ten (10) years or more; any distribution to the extent such distribution is required under
section 401(a)(9) of the Code; any distribution made after December 31, 1999 on account of hardship; and in the case of a distribution made before January 1, 2002, the portion of any distribution that is not includible in gross income (determined
without regard to the exclusion for net unrealized appreciation with respect to employer securities). A portion of a distribution that is includible in the gross income of the distributee that is treated as an eligible rollover distribution may only
be transferred in a direct rollover to an eligible retirement plan that agrees to separately account for such portion of the distribution. This section 13.6 shall not apply to any eligible rollover distributions during a year that are reasonably
expected (as determined by the Committee) to total less than $200. In no event shall any withdrawal during service that is made on account of hardship be considered an “eligible rollover distribution”. This section 13.6 shall be
interpreted to comply with the provisions of section 401(a)(31) of the Code. 

	5.	 	Section 16.2 - Section 16.2 of the Plan shall be amended, effective as of January 1, 2002, to read in its entirety as follows: 

  
 Section 16.2 Definition of Top
Heavy Plan. 
  
 (a)
Subject to section 16.2(c), the Plan is a Top Heavy Plan if, as of a Determination Date: (i) it is not a member of a Required Aggregation Group, and (ii)(A) the sum of the Cumulative Accrued Benefits of all Key Employees exceeds 60% of (B) the sum
of the Cumulative Accrued Benefits of all Employees (excluding former Key Employees), former Employees (excluding former Key Employees and other former Employees who have not performed any services for the Company or any Affiliated Employer during
the immediately preceding 5 Plan Years if the Determination Date is before January 1, 2002 and one Plan Year if the Determination Date is after December 31, 2001) and their Beneficiaries. 
  
 (b) Subject to section 16.2(c), the Plan is a Top Heavy Plan
if, as of a Determination Date: (i) the Plan is a member of a Required Aggregation Group, and (ii)(A) the sum of the Cumulative Accrued Benefits of all Key Employees under all plans that are members of the Required Aggregation Group exceeds 60% of
(B) the sum of the Cumulative Accrued Benefits of all Employees (excluding former Key Employees), former Employees (excluding former Key Employees and other former Employees who have not performed any services for the Company or any Affiliated
Employer during the immediately preceding 5 Plan Years if the Determination is before January 1, 2002 and one Plan Year if the Determination Date is after December 31, 2001), and their Beneficiaries under all plans that are members of the Required
Aggregation Group. 
  
 (c) Notwithstanding
sections 16.2(a) and 16.2(b), the Plan is not a Top Heavy Plan if, as of a Determination Date: (i) the Plan is a member of a Permissible Aggregation Group, and (ii)(A) the sum of the Cumulative Accrued Benefits of all Key Employees under all plans
that are members of the Permissible Aggregation Group does not exceed 60% of (B) the sum of the Cumulative Accrued Benefits of all Employees (excluding former Key Employees), former Employees (excluding former Key Employees and other former
Employees who have not performed any services for the Company or any Affiliated Employer during the immediately preceding 5 Plan Years if the Determination Date is before January 1, 2002 and one Plan Year if the Determination Date is after December
31, 2001), and their Beneficiaries under all plans that are members of the Permissible Aggregation Group. 
  

	6.	 	Section 16.4 - Subsection 16.4(a)(iii) of the Plan shall be amended, effective as of January 1, 2002, to read in its entirety as follows: 

  
 (iii) the amount of any distributions of such person’s
Cumulative Accrued Benefits under the Plan (including, for Plan Years beginning after December 31, 2001, distributions under terminated plans that would have been included in the Required Aggregation Group if not terminated) during the 5-year period
(for all distributions for Plan 

 
Years beginning before January 1, 2002 and for in-service distributions for Plan Years beginning after December 31, 2001) or 1-year period (for all
distributions other than in-service distributions for Plan Years beginning after December 31, 2001) ending on the Determination Date. 
  

	7.	 	Section 16.5 - Subsection 16.5(a)(iv) shall be amended, effective as of January 1, 2002, by adding the words “in plan years beginning before January 1, 2002” at the
beginning thereof. 

  
 IN
WITNESS WHEREOF, this Amendment has been executed by the undersigned officer of AF Bank pursuant to authority given by resolution of the Board of Directors. 
  

	AF BANK
		
	 By
	 	 /s/ James A. Todd

	 	 	 Name:

	 	 	 Title:EXHIBIT 10.8

 Exhibit 10.8 
  

	 	  	                        AMENDMENT NO.4
	EMPLOYEE STOCK OWNERSHIP PLAN	  	 	  	 
	OF	  	DOCUMENT:	  	WA01/3131226
	AF BANK	  	DRAFT DATE:	  	12/03/02
		
	Adopted on September 10, 1996	  	BOARD OF DIRECTORS
	Effective on July 1, 1996	  	APPROVAL DATE:	  	12/16/02

  
 AMENDMENT

  

	1.	 	Article I - Section 1.5 of the Plan shall be amended, effective as of January 1, 2003, to read in its entirety as follows: 

  
 Section 1.5 Beneficiary
means a natural person designated by a Participant or Former Participant as a Beneficiary under section 13.2 and shall not include any Beneficiary designated by a person other than a Participant or Former Participant or any Beneficiary other than a
natural person. If a natural person is the beneficiary of a trust which a Participant or Former Participant has named as his Beneficiary, such natural person shall be treated as a designated Beneficiary if: (a) the trust is a valid trust under
applicable state law (or would be a valid trust except for the fact that it does not have a corpus); (b) the trust is irrevocable or will, by its terms, become irrevocable upon the death of the Participant or Former Participant; (c) the
beneficiaries of the trust who are beneficiaries with respect to the trust’s interest as a Beneficiary are identifiable from the terms of the trust instrument; and (d) the following information is furnished to the Committee: 
  
 (i) by the Participant or Former Participant, if any
distributions are required to be made pursuant to section 13.5 prior to the death of the Participant or Former Participant and (in the case of distributions after December 31, 2002 only) the Participant’s or Former Participant’s spouse is
his sole primary Beneficiary, either: (A) a copy of the trust instrument, together with a written undertaking by the Participant or Former Participant to furnish a copy of any subsequent amendment to the Committee within a reasonable time after such
amendment is made; or (B)(I) a list of all of the beneficiaries of the trust (including contingent and remainderman beneficiaries with a description of the conditions on their entitlement); (II) a certification of the Participant or Former
Participant to the effect that, to the best of his knowledge, such list is correct and complete and that the conditions of section 1.5(a), (b) and (c) are satisfied; (III) a written undertaking to provide a new certification to the extent that an
amendment changes any 

  

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information previously certified; and (IV) a written undertaking to furnish a copy of the trust instrument to the Committee on demand; and 
  
 (ii) by the trustee of the trust within nine months after
the death of the Participant or Former Participant (prior to January 1, 2003) or by October 31st of the first calendar year that begins after the death of the Participant or Former Participant (subsequent to December 31, 2002), if any distributions
are required to be made pursuant to section 13.5 after the death of the Participant or Former Participant, either: (A) a copy of the actual trust instrument for the trust; or (B)(I) a final list of all of the beneficiaries of the trust (including
contingent and remainderman beneficiaries with a description of the conditions on their entitlement) as of the date of death (prior to January 1, 2003) or as of September 30th of the first calendar year that begins after the date of death
(subsequent to December 31, 2002); (II) a certification of the trustee to the effect that, to the best of his knowledge, such list is correct and complete and that the conditions of section 1.5(a), (b) and (c) are satisfied; and (III) a written
undertaking to furnish a copy of the trust instrument to the Committee on demand. 
  

	2.	 	Article XIII - Section 13.3(b)(ii)(A) of the Plan shall be amended, effective as of January 1, 2003, to read in its entirety as follows: 

  
 (A) in annual installments payable beginning as of any
Valuation Date that is coincident with or following his termination of employment, but in no event later than December 31st of the calendar year in which he attains age 70 1/2 and continuing for a fixed period of not
more than the lesser of (I) ten (10) years and (II) the life expectancy of the Employee or the joint life and last survivor expectancy of the Employee and his designated Beneficiary (determined before January 1, 2003 under Tables V and VI of section
1.72-9 of the Income Tax Regulations, using their respective attained ages as of their birthdays in the calendar year that includes the Valuation Date as of which the first payment is made, and after December 31, 2002 under the Uniform Lifetime
Table set forth in section 1.401(a)(9)-9 of the Treasury regulations using the Employee’s age as of the Employee’s birthday in such calendar year or, if the Employee’s sole designated Beneficiary is a surviving spouse who is more than
10 years younger than the Employee, the under the Joint and Last Survivor Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the Employee’s and spouse’s attained ages as of the Employee’s and spouse’s
birthdays in such calendar year); or 
  

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	3.	 	Article XIII - Section 13.3(c) of the Plan shall be amended, effective as of January 1, 2003, to read in its entirety as follows: 

  
 (c) If any person dies before his entire vested interest in
his Account has been distributed to him, then the remainder of such vested interest shall be paid to his Beneficiary under section 13.2 either: 
  
 (i) in a lump sum distribution as of the Valuation Date next following the date of his death, and the amount thereof shall be based on
the vested portion of the balance credited to his Account as of such Valuation Date; or 
  
 (ii) if, prior to the death of the Participant or Former Participant whose account is to be distributed, an election pursuant to section
13.3(b)(ii)(B) is in effect for him, in a lump sum distribution as of the Valuation Date specified in such election, or, if earlier, the latest Valuation Date which would permit payment to be made by December 31st of the calendar year that includes
the fifth anniversary of the Employee’s death and the amount thereof shall be based upon the vested portion of the balance credited to his Account as of such Valuation Date; or 
  
 (iii) if, prior to such Participant’s or Former Participant’s death, an election pursuant to
section 13.3(b)(ii)(A) is in effect for him: 
  
 (A) over the period and at the times set forth in such election, if distribution has begun prior to the Participant’s or Former Participant’s death; or 
  
 (B) commencing at the time set forth in such election (or, if earlier, as of the last Valuation Date that
will permit payment to begin no later than December 31st of the calendar year after the calendar year that includes the date on which the deceased Participant or Former Participant would have attained age 70 1/2, if he had lived) or the date of the deceased Participant’s or Former Participant’s death (whichever is
later) and over the period set forth in such election (or, if less, the life expectancy of the Beneficiary), if the Employee’s spouse is his Beneficiary and distribution has not begun prior to the deceased Participant’s or Former
Participant’s death; or 
  
 (C)
commencing on the date specified in such election (or if earlier, the last Valuation Date that will permit payment to begin by December 31st of the calendar year that includes the first anniversary of the deceased Participant’s or Former
Participant’s death) and over the period set forth in the election (or, if less, the life expectancy of the Beneficiary), if the deceased Participant’s or Former Participant’s Beneficiary is a designated Beneficiary other 

  

 3 

 
than his spouse and distribution has not begun prior to the Employee’s death. 
  
 (iv) upon written application of the Beneficiary made in such form and manner as the Committee may
prescribe, at another time or in another manner permitted under section 13.3(a) or (b), but subject to the following limitations: 
  
 (A)(I) If such Beneficiary is a designated Beneficiary other than the spouse of the deceased Participant or Former Participant whose
vested Account is being distributed, a distribution that commences by December 31st of the calendar year that includes the first anniversary of such deceased Participant’s or Former Participant’s death shall be made over a fixed period
that does not exceed the life expectancy of such Beneficiary; and 
  
 (II) In all other cases where the spouse of the deceased Participant or Former Participant whose vested Account is being distributed is not the Beneficiary, payment must be completed by December 31st of the calendar
year that includes the fifth anniversary of the death of such deceased Participant or Former Participant; and 
  
 (III) If such Beneficiary is the spouse of the deceased Participant or Former Participant whose vested Account is being distributed,
distribution must commence not later than December 31st of the calendar year that includes the date on which the deceased Participant or Former Participant would have attained age 70 1/2 (or, if later, December 31st of the calendar year following he calendar year in which the deceased Participant or Former Participant died) and must be
completed within a period equal to the life expectancy of the designated Beneficiary; and 
  
 (B) In cases where distribution has commenced prior to the death of the deceased Participant or Former Participant whose Account is being
distributed, distribution must be completed at least as rapidly as under the method in effect prior to such deceased Participant or Former Participant death. 
  

The determination whether a Beneficiary is a designated Beneficiary and whether a designated Beneficiary is a surviving spouse shall be made not later
than September 30th of the calendar year following the calendar year in which the Participant or Former Participant dies. For purposes of computing payments in years prior to 2003, life expectancy shall be determined using Table V of section 1.72-9
of the Income Tax Regulations based on the Beneficiary’s attained age in the year of the first payment. For purposes of computing payments in years after 2002, payments for calendar years that begin during the lifetime of a surviving spouse who
is a designated Beneficiary shall be determined using the Single Life 

  

 4 

 
Table set forth in section 1.401(a)(9)-9 of the Income Tax Regulations based on the spouse’s attain age in such year and payments for subsequent
calendar years shall be determined using the Single Life Table set forth in section 1.401(a)(9)-9 of the Income Tax Regulations based on the spouse’s attain age in the year of death. For purposes of computing payments in years after 2002,
payments to a designated Beneficiary other than surviving spouse shall be determined using the Single Life Table set forth in section 1.401(a)(9)-9 of the Income Tax Regulations based on the designated Beneficiary’s attain age in the year of
the Participant or Former Participant’s death. 
  

	4.	 	Article XIII - Section 13.5(b) of the Plan shall be amended, effective as of January 1, 2003, by replacing the last two sentences thereof with a new subsection 13.5(c)
and renumbering the following sections accordingly. The new subsection 13.5(c) shall read in its entirety as follows: 

  
 (c) For purposes of section 13.5(b): 
  
 (i) for taxable years beginning before January 1, 2003, the life expectancy of a Participant or Former Participant (or the joint life and
last survivor expectancy of a Participant or Former Participant and his designated Beneficiary) for the calendar year in which the Participant or Former Participant attains age 70 1/2 shall be determined on the basis of Tables V and VI, as applicable, of section 1.72-9 of the Income Tax Regulations as of the Participant’s or Former Participant’s
birthday in such year. Such life expectancy or joint life and last survivor expectancy for any subsequent year shall be equal to the excess of (1) the life expectancy or joint life and last survivor expectancy for the year in which the Participant
or Former Participant attains age 70 1/2, over (2) the number of whole years that have elapsed since the
Participant or Former Participant attained age 70 1/2; and 
  
 (ii) for taxable years beginning after December 31, 2002,
during the Participant’s or Former Participant’s lifetime, life expectancy shall be equal to: 
  
 (1) the distribution period in the Uniform Lifetime Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the
Participant’s age as of the Participant’s birthday in such calendar year; or 
  
 (2) if the Participant’s spouse is the sole designated Beneficiary and the spouse is more than ten years younger than the
Participant, the number in the Joint and Last Survivor Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the Participant’s and spouse’s attained ages as of the Participant’s and spouse’s birthdays in
such calendar year. 
  

 5 

 IN WITNESS WHEREOF, this Amendment has
been executed by the undersigned officer of AF Bank pursuant to authority given by resolution of the Board of Directors. 
  

	 AF BANK

		
	 By
	 	         /s/ James A. Todd

	 	 	 Name:

	 	 	 Title:

  

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