Document:

exhibit10-8.htm

     

    
      

      

    

    
      Exhibit
        10.8

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        [Form
          for Director Agreement at Bank Level]

      

       

       

       

      ESB
        BANK

       

      AMENDED
        AND RESTATED DIRECTOR RETIREMENT AGREEMENT

      

      THIS
        AMENDED AND RESTATED AGREEMENT is made and entered into this 20th day of
        November 2007, by and between ESB Bank (the “Bank”), a wholly-owned subsidiary
        of ESB Financial Corporation (the “Corporation”), located in Ellwood City,
        Pennsylvania, and ________________ (the “Director”), intending to be legally
        bound hereby.

      

      INTRODUCTION

      

      The
        Bank and the Director previously
        entered into a certain Amended and Restated Director Retirement Agreement
        dated
        as of November 21, 2006 (the “Prior Agreement”).  This Agreement
        amends and restates the Prior Agreement in its entirety as hereinafter set
        forth
        in order to comply with the requirements of Section 409A of the Internal
        Revenue
        Code of 1986, as amended (the “Code”), including the final regulations issued by
        the Internal Revenue Service in April 2007.  No benefits payable under
        this Agreement shall be deemed to be grandfathered for purposes of Section
        409A
        of the Code.

      

      This
        Agreement shall at all times be characterized as a “top hat” plan of deferred
        compensation maintained for a select group of management or highly compensated
        employees, as described under Sections 201(2), 301(a)(3) and 401(a)(1) of
        the
        Employee Retirement Income Security Act of 1974, as amended, and any regulations
        relating thereto (“ERISA”).  The

      Agreement
        has been and shall continue to be operated in compliance with Section 409A
        of
        the Code.  The Agreement is an unfunded plan for tax
        purposes.  The provisions of the Agreement shall be construed to
        effectuate such intentions.

      

      AGREEMENT

      

      The
        Director and the Bank agree as follows:

      

      Article
        1

      Definitions

      

      Whenever
        used in this Agreement, the following words and phrases shall have the meanings
        specified:

      

      1.1           “Base
        Board Fees” means the regular monthly Bank board fees and does not include
        committee fees, advisory board fees, director emeritus fees, liaison fees
        or
        other income that might be received by the Director.

      

      1.2           “Change
        in Control” means a change in the ownership of the Corporation or the Bank,
        a change in the effective control of the Corporation or the Bank or a change
        in
        the ownership of a substantial portion of the assets of the Corporation or
        the
        Bank, in each case as provided under Section 409A of the Code and the
        regulations thereunder.

      

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      1.3           “Code”
        means the Internal Revenue Code of 1986, as amended.

      

      1.4           “Deferred
        Retirement” means the Director has met the eligibility requirements
        described in Article 2 and has a Separation from Service after his Normal
        Retirement Age for any reason other than following a Change in
        Control.

      

      1.5           “Deferred
        Retirement Date” means the first day of the month coincident with or next
        following the date of the Director’s Separation from Service subsequent to the
        Director’s Normal Retirement Age.

      

      1.6           “Early
        Termination” means the Director has met the eligibility requirements
        described in Article 2 but has a Separation from Service before Normal
        Retirement Age for any reason other than following a Change in
        Control.

      

      1.7           “Early
        Termination Date” means the month, day and year in which Early Termination
        occurs.

      

      1.8           “Effective
        Date” means February 11, 2005, except that the amendment and restatement of
        this Agreement shall be effective as of the date first written
        above.

      

      1.9           “Normal
        Retirement Age” means the Director’s 75th
birthday.

      

      1.10           “PlanYear”
        means the calendar year.  In the year of inception, the Plan Year
        commences on the Effective Date of this Agreement and ends on December 31st of the
        same
        year.

      

      1.11           “Separation
        from Service” means a termination of a Director’s services (whether as an
        employee or as an independent contractor) to the Corporation and the Bank
        for
        any reason.  Whether a Separation from Service has occurred shall be
        determined in accordance with the requirements of Section 409A of the Code
        based
        on whether the facts and circumstances indicate that the Corporation, the
        Bank
        and the Director reasonably anticipated that no further services would be
        performed after a certain date or that the level of bona fide services the
        Director would perform after such date (whether as an employee or as an
        independent contractor) would permanently decrease to no more than twenty
        percent (20%) of the average level of bona fide services performed (whether
        as
        an employee or an independent contractor) over the immediately preceding
        thirty-six (36) month period.  For purposes of this Agreement, if
        there is a dispute over the service status of the Director or the date of
        the
        Director’s Separation from Service, the Bank shall have the sole and absolute
        right to decide the dispute.

      

      1.12           “Specified
        Employee” means a key employee within the meaning of Section 409A of the
        Code and the regulations thereunder.

      

      1.13           “Termination
        for Cause” has the meaning set forth in Section 6.2.

      

      1.14           “Years
        of Service” means the total number of continuous years of service as a
        Director of the Bank, inclusive of any approved leaves of absences and service
        as a member of the Board of Directors of any bank acquired by the Bank or
        the
        Corporation, including all years of service accrued prior to the Effective
        Date.  In the event the Director also becomes a director of the
        Corporation, a year of service of both the Bank and the Corporation concurrently
        shall only count as one year of service; and provided further, that any service
        as a director emeritus or as an advisory director shall be excluded in
        determining Years of Service.

      

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      Article
        2

      Eligibility
        to Participate

      

      To
        be
        entitled to any benefit under this Agreement, the Director must have a minimum
        of 5 Years of Service as a director of the Bank (as opposed to service as
        a
        director of any bank acquired by the Bank or the Corporation) and a minimum
        of
        10 total Years of Service.

      

      

      Article
        3

      Retirement
        Benefits

      

      3.1           Annual
        Normal Retirement Benefit.  If the Director satisfies the
        requirements of Article 2 and remains in continuous service as a member of
        the
        Board of Directors of the Bank from the Effective Date of this Agreement
        until
        Normal Retirement Age, the Bank shall pay to the Director the benefit described
        in this Section 3.1 in lieu of any other benefit under this
        Agreement.

      

      3.1.3   Amount
        of Benefit.  The Annual Normal Retirement Benefit under this
        Section 3.1 will be determined using the following formula:

      

      The
        Director’s Base Board Fees earned during the last full calendar year prior to
        his retirement date (or, if earlier, the last full calendar year prior to
        becoming a director emeritus), multiplied by a ratio ranging from 25% to
        80%
        based on the Director’s total Years of Service as follows:

      

      
        	
                 

              	
                 Years
                  of Service

              	 	
                Retirement
                  Percentage

              
	
                 

              	
                 10

              	 	
                25.0%

              
	
                 

              	
                 11

              	 	
                27.5%

              
	
                 

              	
                 12

              	 	
                30.0%

              
	
                 

              	
                 13

              	 	
                32.5%

              
	
                 

              	
                 14

              	 	
                35.0%

              
	
                 

              	
                 15

              	 	
                37.5%

              
	
                 

              	
                 16

              	 	
                40.0%

              
	
                 

              	
                 17

              	 	
                42.5%

              
	
                 

              	
                 18

              	 	
                45.0%

              
	
                 

              	
                 19

              	 	
                47.5%

              
	
                 

              	
                 

              	20
                or more 	
                80.0%

              

      

      

      3.1.4  Payment
        of Benefit.  The Bank shall pay the annual benefit to the
        Director each year for five years, with the annual benefits to be paid in
        equal
        monthly installments on the first day of each month commencing with the month
        following the Director’s Separation from Service and continuing for the 59
        months that follow, subject to Section 3.5 hereof.

      

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      3.2         Early
        Termination Benefit.  Upon Early Termination, the Bank shall pay
        to the Director the benefit described in this Section 3.2 in lieu of any
        other
        benefit under this Agreement.

      

      3.2.3  Amount
        of Benefit.  The benefit under this Section 3.2 is the Early
        Termination Annual Benefit set forth in Schedule A for the Plan Year ended
        immediately prior to the Early Termination Date.

      

      3.2.4  Payment
        of Benefit.  The Bank shall pay the benefit to the Director (or
        his beneficiary if Separation from Service was due to death) in a lump sum
        payment within 60 days of the Director’s Early Termination Date, subject to
        Section 3.5 hereof.

      

      3.3         Deferred
        Retirement Benefit.  If the Director satisfies the requirements
        of Article 2 and remains in continuous service as a member of the Board of
        Directors of the Bank from the Effective Date of this Agreement until his
        Deferred Retirement Date, the Bank shall pay to the Director the benefit
        described in this Section 3.3 in lieu of any other benefit under this
        Agreement.

      

          3.3.1      Amount
        of Benefit.  The Deferred Retirement Benefit under this Section
        3.3 will be determined using the same formula as set forth in Section 3.1.1
        above.

      

          3.3.2      Payment
        of Benefit.  The Bank shall pay the annual benefit to the
        Director each year for five years, with the annual benefits to be paid in
        equal
        monthly installments on the first day of each month commencing with the month
        following the Director’s Separation from Service and continuing for the 59
        months that follow, subject to Section 3.5 hereof.

      

      3.4         Change
        in Control Annual Benefit.  If the Director satisfies the
        requirements of Article 2 and is in the active service of the Bank at the
        time
        of a Change in Control, and does not have a Separation from Service prior
        to the
        consummation of the transaction which constitutes the Change in Control,
        the
        Bank shall pay to the Director the benefit described in this Section 3.4
        in lieu
        of any other benefit under this Agreement.

      

      3.4.3  Amount
        of Benefit.  The annual benefit under this Section 3.4 is the
        Director’s Base Board Fees earned during the  last  full calendar year
        prior to consummation of the Change in Control (or, if earlier, the last
        full
        calendar year prior to becoming a director emeritus) multiplied by
        80%.

      

      3.4.4  Payment
        of Benefit.  The Bank shall
        pay the annual benefit to the Director each year for five years, with the
        annual
        benefits to be paid in equal monthly installments commencing on the first
        day of
        the month following consummation of the Change in Control and continuing
        for the
        59 months that follow.

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      3.5         Six-Month
        Delay.  If the Director is a Specified Employee upon reaching
        Normal Retirement Age, then the monthly payments specified in Section 3.1.2
        above shall not commence until the first day of the month following the lapse
        of
        six months after reaching Normal Retirement Age, and shall then continue
        for the
        59 months that follow.  If the Director is a Specified Employee upon
        Early Termination, then the lump sum payment specified in Section 3.2.2 above
        shall be delayed until the first day of the month following the lapse of
        six
        months after the Early Termination Date.  If the Director is a
        Specified Employee upon Deferred Retirement, then the monthly payments specified
        in Section 3.3.2 above shall not commence until the first day of the month
        following the lapse of six months after the Deferred Retirement Date, and
        shall
        then continue for the 59 months that follow.

      

      

      Article
        4

      Death
        Benefits

      

      4.3  Death
        During Benefit Period.  If the Director dies after the benefit
        payments have commenced under this Agreement but before receiving all such
        payments, the Bank shall pay the remaining benefits to the Director’s
        beneficiary at the same time and in the same amounts they would have been
        paid
        to the Director had the Director survived.

      

      4.4  Death
        Before Benefit Payments Commence. If the Director is
        entitled to benefit payments under this Agreement, but dies prior to the
        commencement of said benefit payments, the Bank shall pay the benefit payments
        to the Director’s beneficiary that the Director was entitled to prior to death,
        except that the benefit payments shall commence on the first day of the month
        following the date of the Director’s death.

      

      

      Article
        5

      Beneficiaries

       

          5.1         Beneficiary
        Designations.  The Director shall designate a beneficiary by
        filing a written designation with the Bank.  The Director may revoke
        or modify the designation at any time by filing a new
        designation.  However, designations and revocations or modifications
        of designations shall only be effective if they are filed with the Bank as
        a
        written document, signed by the Director and accepted by the Bank during
        the
        Director’s lifetime.  The Director’s beneficiary designation shall be
        deemed automatically revoked if the beneficiary predeceases the Director,
        or if
        the Director names a spouse as beneficiary and the marriage is subsequently
        dissolved.  If the Director dies without a valid beneficiary
        designation, all payments shall be made to the Director’s estate.

      

      5.2         Facility
        of Payment.  If a benefit is payable to a minor, to a person
        declared incapacitated, or to a person incapable of handling the disposition
        of
        his or her property, the Bank may pay such benefit to the guardian, legal
        representative or person having the care or custody of such minor, incapacitated
        person or incapable person.  The Bank may require proof of incapacity,
        minority or guardianship as it may deem appropriate prior to distribution
        of the
        benefit.  Such distribution shall completely discharge the Bank from
        all liability with respect to such benefit.

      

      

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      Article
        6

      General
        Limitations

      

      6.3  Excess
        Parachute or Golden Parachute Payment. Notwithstanding any provision of
        this Agreement to the contrary, the Bank shall not pay any benefit under
        this
        Agreement to the extent the benefit would be a parachute payment under Section
        280G of the Code or would be a prohibited golden parachute payment pursuant
        to
        12 C.F.R. §359.2 and for which the appropriate federal banking agency has not
        given written consent to pay pursuant to 12 C.F.R. §359.4.

      

      6.4  Termination
        for Cause. Notwithstanding any provision of this Agreement to the contrary,
        the Bank shall not pay any benefit under this Agreement if the Bank terminates
        the Director’s service for:

      
         

        
                    
            6.4.1       Gross negligence or gross neglect
            of duties;

          
             

                     
              6.4.2        Commission of a felony or
              of a gross misdemeanor involving moral turpitude; or

          

           

        

      

      
                  6.4.3       Fraud,
          disloyalty, dishonesty or willful violation of any law or significant Bank
          or
          Corporation policy committed in connection with the Director’s service and
          resulting in an adverse effect on the Bank or the Corporation.

              
          6.3      
Removal.  Notwithstanding any provision of this Agreement to
          the contrary, the Bank shall not pay any benefit under this Agreement if
          the
          Director is subject to a final removal or prohibition order issued by an
          appropriate federal banking agency pursuant to Section 8(e) of the Federal
          Deposit Insurance Act.

      

      

      

      Article
        7

      Claims
        and Review Procedures

      

        
        7.2 
        Claims
        Procedure.  A Director or beneficiary (“claimant”) who has not
        received benefits under the Agreement that he or she believes should be paid
        shall make a claim for such benefits as follows:

      

      7.2.1  Initiation
        – Written Claim. The claimant initiates a claim by submitting to the Bank a
        written claim for the benefits.

      

      7.2.2  Timing
        of Bank Response. The Bank shall respond to such claimant within 90 days
        after receiving the claim. If the Bank determines that special circumstances
        require additional time for processing the claim, the Bank can extend the
        response period by an additional 90 days by notifying the claimant in writing,
        prior to the end of the initial 90-day period, that an additional period
        is
        required. The notice of extension must set forth the special circumstances
        and
        the date by which the Bank expects to render its decision.

      

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      7.2.3  Notice
        of Decision. If the Bank denies part or all of the claim, the Bank shall
        notify the claimant in writing of such denial. The Bank shall write the
        notification in a manner calculated to be understood by the claimant. The
        notification shall set forth:

                      

                       7.2.3.1  The
        specific reasons for the denial,

       

                       7.2.3.2  A
        reference to the specific provisions of the Agreement on which the denial
        is
        based,

       

                       7.2.3.3  A
        description of any additional information or material necessary for the claimant
        to perfect the claim and an explanation of why it is needed,

          

                      
7.2.3.4  An
        explanation of the Agreement’s review procedures and the time limits applicable
        to such procedures, and

       

                      
7.2.3.5  A
        statement of the claimant’s right to bring a civil action under ERISA Section
        502(a) following an adverse benefit determination on review.

      

      7.2         Review
        Procedure. If the Bank denies part or all of the claim, the claimant shall
        have the opportunity for a full and fair review by the Bank of the denial,
        as
        follows:

      
         

                7.21  
          Initiation – Written Claim. The claimant initiates a claim by
          submitting to the Bank a written claim for the benefits.

      

       

      
                7.22  
          Timing of Bank Response. The Bank shall respond to such claimant within 90
          days after receiving the claim. If the Bank determines that special
          circumstances require additional time for processing the claim, the Bank
          can
          extend the response period by an additional 90 days by notifying the claimant
          in
          writing, prior to the end of the initial 90-day period, that an additional
          period is required. The notice of extension must set forth the special
          circumstances and the date by which the Bank expects to render its
          decision.

         

      

              7.2.3
        Considerations on Review. In considering the review, the Bank shall
        take into account all materials and information the claimant submits relating
        to
        the claim, without regard to whether such information was submitted or
        considered in the initial benefit determination.

      

      7.2.4
        Timing of Bank Response. The Bank shall respond in writing to such
        claimant within 60 days after receiving the request for review. If the Bank
        determines that special circumstances require additional time for processing
        the
        claim, the Bank can extend the response period by an additional 60 days by
        notifying the claimant in writing, prior to the end of the initial 60-day
        period, that an additional period is required. The notice of extension must
        set
        forth the special circumstances and the date by which the Bank expects to
        render
        its decision.

      

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      7.2.5  
         Notice of Decision. The Bank shall notify the claimant in writing
        of its decision on review. The Bank shall write the notification in a manner
        calculated to be understood by the claimant. If the Bank denies part or all
        of
        the claim, the notification shall set forth:

       

                  7.2.5.1
        The specific
        reasons for the denial,

       

                  7.2.5.2
        A reference
        to the specific provisions of the Agreement on which the denial is
        based,

      
         

                    7.2.5.3
          A statement
          that the claimant is entitled to receive, upon request and free of charge,
          reasonable access to, and copies of, all documents, records and other
          information relevant to the claimant’s claim for benefits,

      

      
        
           

                      7.2.5.4  A
            statement of the claimant’s right to bring a civil action under ERISA Section
            502(a), and

        

      

       

      
                    7.2.5.5  If
          an internal rule, guideline, protocol or other similar criterion was relied
          upon
          in making the adverse determination on review, a statement that a copy
          of the
          rule, guideline, protocol or other similar criterion will be provided without
          charge to the claimant upon request.

      

      
         

         

      

      Article
        8

      Amendment
        and Termination

      

      
        	
                 

              	
                8.1

              	
                Amendment
                  or Termination of Agreement.

              

      

      

      8.1.1  General.  This
        Agreement may be amended or terminated only by a written agreement signed
        by the
        Bank and the Director, except as provided in Article 6 and except as provided
        below.  A termination of this Agreement will not be a distributable
        event, except in the two circumstances set forth in Section 8.1.2
        below.  Notwithstanding anything in the Agreement to the contrary, the
        Bank may amend in good faith any terms of the Agreement, including retroactively
        to the extent permitted by law, in order to comply with Section 409A of the
        Code.

       

              8.1.2  Termination.  Under
        no circumstances may the Agreement permit the acceleration of the time or
        form
        of any payment under the Agreement prior to the payment events specified
        herein,
        except as provided in this Section 8.1.2.  The Bank may, in its
        discretion, elect to terminate the Agreement in any of the following two
        circumstances and accelerate the payment of the entire unpaid balance of
        the
        Director’s vested benefits under Article 3 as of the date of such payment in
        accordance with Section 409A of the Code:

      

      
        	
                (iv)  

              	
                the
                  Agreement is irrevocably terminated at a time that is not proximate
                  to a
                  downturn in the financial health of the Corporation or the Bank
                  and (1)
                  all arrangements sponsored by the Corporation and the Bank that
                  would be
                  aggregated with the Agreement under Treasury Regulation 1.409A-1(c)
                  if the
                  Director participated in such arrangements are terminated, (2)
                  no payments
                  are made within 12 months of the date the Corporation and the Bank
                  take
                  all necessary action to irrevocably terminate the arrangements,
                  other than
                  payments that would be payable under the terms of the arrangements
                  if the
                  termination had not occurred; (3) all payments are made within
                  24 months
                  of the date the Corporation and the Bank take all necessary action
                  to
                  irrevocably terminate the arrangements; and (4) neither the Corporation
                  nor the Bank adopts a new arrangement that would be aggregated
                  with the
                  Agreement under Treasury Regulation 1.409A-1(c) if the Director
                  participated in both arrangements, at any time within three years
                  following the date the Corporation and the Bank take all necessary
                  action
                  to irrevocably terminate the Agreement;
                  or

              

      

      

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      
        	
                 

              	
                         
                  (ii)

              	
                the
                  Agreement is terminated within 12 months of a corporate dissolution
                  taxed
                  under Section 331 of the Code, or with the approval of a bankruptcy
                  court
                  pursuant to 11 U.S.C. §503(b)(1)(A), provided that the amounts deferred by
                  the Director under the Agreement are included in the Director’s gross
                  income in the later of (1) the calendar year in which the termination
                  of
                  the Agreement occurs, or (2) the first calendar year in which the
                  payment
                  is administratively practicable.

              

      

       

       

      Article
        9

      Miscellaneous

      

      9.11  Binding
        Effect.  This Agreement shall bind the Director and the Bank, and
        their successors, beneficiaries, survivors, executors, administrators and
        transferees.

      

      9.12  No
        Guarantee of Service.  This Agreement is not a service policy or
        contract.  It does not give the Director the right to remain a member
        of the Board of Directors of the Bank, nor does it interfere with the Bank’s
        right to terminate the Director’s service.  It also does not require
        the Director to remain a Board member nor interfere with the Director’s right to
        terminate service at any time.

      

      9.13  Non-Transferability.
        Benefits under this Agreement cannot be sold, transferred, assigned, pledged,
        attached or encumbered in any manner.

      

      9.14  Tax
        Withholding.  The Bank shall withhold any taxes that are required
        to be withheld from the benefits provided under this Agreement.

      

      9.15  Applicable
        Law.  This Agreement and all rights hereunder shall be governed
        by the laws of the Commonwealth of Pennsylvania, except to the extent preempted
        by the laws of the United States of America.

      

      9.16  Reorganization.  The
        Bank shall not merge or consolidate into or with another company, or reorganize,
        or sell substantially all of its assets to another company, firm or person
        unless such succeeding or continuing company, firm or person agrees to assume
        and discharge the obligations of the Bank under this Agreement.

      

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      9.17  Unfunded
        Arrangement.  The Director and any beneficiary are general
        unsecured creditors of the Bank for the payment of benefits under this
        Agreement.  The benefits represent the mere promise by the Bank to pay
        such benefits.  The rights to benefits are not subject in any manner
        to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
        attachment, or garnishment by creditors.  Any insurance on the
        Director’s life is a general asset of the Bank to which the Director and
        beneficiary have no preferred or secured claim.

      

      9.18  Changes
        in Statutes or Regulations.  If any statutory or regulation
        provision referenced herein is subsequently changed or re-numbered, or is
        replaced by a separate provision, then the references in this Agreement to
        such
        statutory or regulatory provision shall be deemed to be a reference to such
        section as amended, re-numbered or replaced.

      

      9.19  Entire
        Agreement.  This Agreement constitutes the entire agreement
        between the Bank and the Director as to the subject matter hereof.  No
        rights are granted to the Director by virtue of this Agreement other than
        those
        specifically set forth herein.

      

      9.20  Administration.  The
        Bank shall have all powers which are necessary to administer this Agreement,
        including but not limited to:

       

      
        	 	 9.10.5	Interpreting
                the provisions of the Agreement;
	 	 
	 	 9.10.6	Establishing
                and revising the method of accounting for the
                Agreement;
	 	 
	 	 9.10.7	Maintaining
                a record of benefit payments; and
	 	 
	 	 9.10.8	Establishing
                rules and prescribing any forms necessary or desirable to administer
                the
                Agreement.

      

       

      

      IN
        WITNESS WHEREOF, the Director and a duly authorized officer of ESB Bank have
        signed this Agreement.

      

      
        	DIRECTOR:	ESB
                BANK:
	 	
                 

              	 
	 	 	 
	  	 	By:	 	 
	Name: 	 	 	
                Name:

              	 	 
	
                 

              	 	 	
                Title:

              	 	 

      

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      BENEFICIARY
        DESIGNATION

       

      ESB
        BANK

       

      AMENDED
        AND RESTATED DIRECTOR RETIREMENT AGREEMENT

      

      
        	
                 

              	
                __________________

              

      

      

       
I
        designate the following as beneficiary of any death benefits under the ESB
        Bank
        Amended and Restated Director Retirement Agreement:

      

      
        	
                 

              	
                Primary:  ___________________________________________________________________________________________________________

              

      

      

      
        	
                 

              	
                __________________________________________________________________________________________________________________

              

      

      

      
        	
                 

              	
                Contingent:  ________________________________________________________________________________________________________

              

      

      

      
        	
                 

              	
                __________________________________________________________________________________________________________________

              

      

      

      
        	
                 

              	
                Note:  To
                  name a trust as beneficiary, please provide the name of the Trustee(s)
                  and
                  the exact name and date of the trust
                  agreement.

              

      

      

      I
        understand that I may change these beneficiary designations by filing a new
        written designation with the Bank.  I further understand that the
        designations will be automatically revoked if the beneficiary predeceases
        me or,
        if I have named my spouse as beneficiary, in the event of the dissolution
        of our
        marriage.

      

      

      Signature   ______________________________

      

      Date   __________________________________

      

      

      Accepted
        by the Bank this ______ day of _________________, 200_.

      

      

      By  ____________________________________

      

      Title  __________________________________

      

      

      
        
          
          

        

        
          11exhibit10-9.htm

     

    
      

      

    

    
      Exhibit
        10.9

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      PENNFIRST
        BANCORP, INC.

      AMENDED
        AND RESTATED 1997 STOCK OPTION PLAN

      

      ARTICLE
        I

      ESTABLISHMENT
        OF THE PLAN

      

      ESB
        Financial Corporation (the
“Corporation”) hereby amends and restates the PennFirst Bancorp, Inc. 1997 Stock
        Option Plan (as amended and restated, the “Plan”) upon the terms and conditions
        hereinafter stated, with the amendment and restatement effective as of November
        20, 2007.

      

      

      ARTICLE
        II

      PURPOSE
        OF THE PLAN

      

      The
        purpose of this Plan is to improve
        the growth and profitability of the Corporation and its Subsidiary Companies
        by
        providing Employees and Non-Employee Directors with a proprietary interest
        in
        the Corporation as an incentive to contribute to the success of the Corporation
        and its Subsidiary Companies, and rewarding those Employees for outstanding
        performance and the attainment of targeted goals.  All Incentive Stock
        Options issued under this Plan are intended to comply with the requirements
        of
        Section 422 of the Code and the regulations thereunder, and all provisions
        hereunder shall be read, interpreted and applied with that purpose in
        mind.

      

      

      ARTICLE
        III

      DEFINITIONS

      

      3.01           “Award”
        means an Option or Stock Appreciation Right granted pursuant to the terms
        of
        this Plan.

      

      3.02           “Bank”
        means ESB Bank, the wholly-owned subsidiary of the Corporation.

      

      3.03           “Board”
        means the Board of Directors of the Corporation.

      

      3.04           “Change
        in Control” shall mean a change in the ownership of the Corporation or the Bank,
        a change in the effective control of the Corporation or the Bank or a change
        in
        the ownership of a substantial portion of the assets of the Corporation or
        the
        Bank, in each case as provided under Section 409A of the Code and the
        regulations thereunder.

      

      3.05           “Code”
        means the Internal Revenue Code of 1986, as amended.

      

      3.06           “Committee”
        means a committee of two or more directors appointed by the Board pursuant
        to
        Article IV hereof, each of whom shall be a Non-Employee Director.

      

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      3.07           “Common
        Stock” means shares of the common stock, $0.01 par value per share, of the
        Corporation.

      

      3.08           “Disability”
        means that the Optionee: (i) is unable 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 can be expected to last for a
        continuous period of not less than 12 months, or (ii) is, by reason of any
        medically determinable physical or mental impairment which can be expected
        to
        result in death or can be expected to last for a continuous period of not
        less
        than 12 months, receiving income replacement benefits for a period of not
        less
        than three months under an accident and health plan covering employees of
        the
        Corporation or the Bank (or would have received such benefits for at least
        three
        months if he had been eligible to participate in such plan).

      

      3.09           “Effective
        Date” means the day upon which the Board originally adopted this
        Plan.

      

      3.10           “Employee”
        means any person who is employed by the Corporation or a Subsidiary Company,
        or
        is an Officer of the Corporation or a Subsidiary Company, but not including
        directors who are not also Officers of or otherwise employed by the Corporation
        or a Subsidiary Company.

      

      3.11           “Exchange
        Act” means the Securities Exchange Act of 1934, as amended.

      

      3.12           “Fair
        Market Value” shall be equal to the fair market value per share of the
        Corporation’s Common Stock on the date an Award is granted.  For
        purposes hereof, the Fair Market Value of a share of Common Stock shall be
        the
        closing sale price of a share of Common Stock on the date in question (or,
        if
        such day is not a trading day in the U.S. markets, on the nearest preceding
        trading day), as reported with respect to the principal market (or the composite
        of the markets, if more than one) or national quotation system in which such
        shares are then traded, or if no such closing prices are reported, the mean
        between the high bid and low asked prices that day on the principal market
        or
        national quotation system then in use.  Notwithstanding the foregoing,
        if the Common Stock is not readily tradable on an established securities
        market
        for purposes of Section 409A of the Code, then the Fair Market Value shall
        be
        determined by means of a reasonable valuation method that takes into
        consideration all available information material to the value of the Corporation
        and that otherwise satisfies the requirements applicable under Section 409A
        of
        the Code and the regulations thereunder.

      

      3.13           “Incentive
        Stock Option” means any Option granted under this Plan which the Board intends
        (at the time it is granted) to be an incentive stock option within the meaning
        of Section 422 of the Code or any successor thereto.

      

      3.14           “Non-Employee
        Director” means a member of the Board who is not an Officer or Employee of the
        Corporation or any Subsidiary Company.

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      3.15           “Non-Qualified
        Option” means any Option granted under this Plan which is not an Incentive Stock
        Option.

      

      3.16           “Officer”
        means an Employee whose position in the Corporation or Subsidiary Company
        is
        that of a corporate officer, as determined by the Board.

      

      3.17           “Option”
        means a right granted under this Plan to purchase Common Stock.

      

      3.18           “Optionee”
        means an Employee or Non-Employee Director to whom an Option is granted under
        the Plan.

      

      3.19           “OTS”
        means the Office of Thrift Supervision.

      

      3.20           “Retirement”
        means a termination of employment upon or after attainment of age sixty-five
        (65) or such earlier age as may be specified in any applicable qualified
        pension
        benefit plan maintained by the Corporation or a Subsidiary Company.

      

      3.21           “Stock
        Appreciation Right” means a right to surrender an Option in consideration for a
        payment by the Corporation in cash and/or Common Stock, as provided in the
        discretion of the Committee in accordance with Section 8.11.

      

      3.22           “Subsidiary
        Companies” means those subsidiaries of the Corporation, including the Bank,
        which meet the definition of “subsidiary corporations” set forth in Section
        425(f) of the Code, at the time of granting of the Award in
        question.

      

      

      ARTICLE
        IV

      ADMINISTRATION
        OF THE PLAN

      

      4.01           Duties
        of the Committee.  The Plan shall be administered and
        interpreted by the Committee, as appointed from time to time by the Board
        pursuant to Section 4.02.  The Committee shall have the authority
        (subject to compliance with applicable OTS regulations) to adopt, amend and
        rescind such rules, regulations and procedures as, in its opinion, may be
        advisable in the administration of the Plan, including, without limitation,
        rules, regulations and procedures which (i) deal with satisfaction of an
        Optionee’s tax withholding obligation pursuant to Section 12.02 hereof, (ii)
        include arrangements to facilitate the Optionee’s ability to borrow funds for
        payment of the exercise or purchase price of an Award, if applicable, from
        securities brokers and dealers, and (iii) include arrangements which provide
        for
        the payment of some or all of such exercise or purchase price by delivery
        of
        previously-owned shares of Common Stock or other property and/or by withholding
        some of the shares of Common Stock which are being acquired.  The
        interpretation and construction by the Committee of any provisions of the
        Plan,
        any rule, regulation or procedure adopted by it pursuant thereto or of any
        Award
        shall be final and binding in the absence of action by the Board of
        Directors.

      

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      4.02           Appointment
        and Operation of the Committee.  The members of the Committee
        shall be appointed by, and will serve at the pleasure of, the
        Board.  The Board from time to time may remove members from, or add
        members to, the Committee, provided the Committee shall continue to consist
        of
        two or more members of the Board, each of whom shall be a Non-Employee
        Director.  The Committee shall act by vote or written consent of a
        majority of its members.  Subject to the express provisions and
        limitations of the Plan, the Committee may adopt such rules, regulations
        and
        procedures as it deems appropriate for the conduct of its affairs.  It
        may appoint one of its members to be chairman and any person, whether or
        not a
        member, to be its secretary or agent.  The Committee shall report its
        actions and decisions to the Board at appropriate times but in no event less
        than one time per calendar year.

      

      4.03           Revocation
        for Misconduct.  The Board of Directors or the Committee may
        by resolution immediately revoke, rescind and terminate any Option, or portion
        thereof, to the extent not yet vested, or any Stock Appreciation Right, to
        the
        extent not yet exercised, previously granted or awarded under this Plan to
        an
        Employee who is discharged from the employ of the Corporation or a Subsidiary
        Company for cause, which, for purposes hereof, shall mean termination because
        of
        the Employee’s personal dishonesty, incompetence, willful misconduct, breach of
        fiduciary duty involving personal profit, intentional failure to perform
        stated
        duties, willful violation of any law, rule, or regulation (other than traffic
        violations or similar offenses) or final cease-and-desist
        order.  Options granted to a Non-Employee Director who is removed for
        cause pursuant to the Corporation’s Articles of Incorporation shall terminate as
        of the effective date of such removal.

      

      4.04           Limitation
        on Liability.  Neither the members of the Board of Directors
        nor any member of the Committee shall be liable for any action or determination
        made in good faith with respect to the Plan, any rule, regulation or procedure
        adopted pursuant thereto or any Awards granted under it.  If any
        members of the Board of Directors or a member of the Committee is a party
        or is
        threatened to be made a party to any threatened, pending or completed action,
        suit or proceeding, whether civil, criminal, administrative or investigative,
        by
        reason of anything done or not done by him in such capacity under or with
        respect to the Plan, the Corporation shall, subject to the requirements of
        applicable laws and regulations, indemnify such member against all liabilities
        and expenses (including attorneys’ fees), judgments, fines and amounts paid in
        settlement actually and reasonably incurred by him in connection with such
        action, suit or proceeding if he acted in good faith and in a manner he
        reasonably believed to be in the best interests of the Corporation and its
        Subsidiary Companies and, with respect to any criminal action or proceeding,
        had
        no reasonable cause to believe his conduct was unlawful.

      

      4.05           Compliance
        with Law and Regulations.  All Awards granted hereunder shall
        be subject to all applicable federal and state laws, rules and regulations
        and
        to such approvals by any government or regulatory agency as may be
        required.  The Corporation shall not be required to issue or deliver
        any certificates for shares of Common Stock prior to the completion of any
        registration or qualification of or obtaining of consents or approvals with
        respect to such shares under any Federal or state law or any rule or regulation
        of any government body, which the Corporation shall, in its sole discretion,
        determine to be necessary or advisable.  Moreover, no Option or Stock
        Appreciation Right may be exercised if such exercise would be contrary to
        applicable laws and regulations.

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      4.06           Restrictions
        on Transfer.  The Corporation may place a legend upon any
        certificate representing shares acquired pursuant to an Award granted hereunder
        noting that the transfer of such shares may be restricted by applicable laws
        and
        regulations.

      

      4.07           No
        Deferral of Compensation Under Section 409A of the Code.  All
        Awards granted under the Plan are designed to not constitute a deferral of
        compensation for purposes of Section 409A of the
        Code.  Notwithstanding any other provision in this Plan to the
        contrary, all of the terms and conditions of any Awards granted under this
        Plan
        shall be designed to satisfy the exemption for stock options or stock
        appreciation rights set forth in the regulations issued under Section 409A
        of
        the Code.  Both this Plan and the terms of all Options and Stock
        Appreciation Rights granted hereunder shall be interpreted in a manner that
        requires compliance with all of the requirements of the exemption for stock
        options or stock appreciation rights set forth in the regulations issued
        under
        Section 409A of the Code.  No Optionee shall be permitted to defer the
        recognition of income beyond the exercise date of a Non-Qualified Option
        or
        Stock Appreciation Right or beyond the date that the Common Stock received
        upon
        the exercise of an Incentive Stock Option is sold.

      

      

      ARTICLE
        V

      ELIGIBILITY

      

      Awards
        may be granted to such Employees
        of the Corporation and its Subsidiary Companies as may be designated from
        time
        to time by the Board of Directors or the Committee.  Awards may not be
        granted to individuals who are not Employees or Non-Employee Directors of
        either
        the Corporation or its Subsidiary Companies.  Non-Employee Directors
        shall be eligible to receive only Non-Qualified Options.

      

      

      ARTICLE
        VI

      COMMON
        STOCK COVERED BY THE PLAN

      

      6.01           Option
        Shares.  The aggregate number of shares of Common Stock which
        may be issued pursuant to this Plan, subject to adjustment as provided in
        Article IX, shall be 195,000 shares.  None of such shares shall be the
        subject of more than one Award at any time, but if an Award as to any shares
        is
        surrendered before exercise, or expires or terminates for any reason without
        having been exercised in full, or for any other reason ceases to be exercisable,
        the number of shares covered thereby shall again become available for grant
        under the Plan as if no Awards had been previously granted with respect to
        such
        shares.  Notwithstanding the foregoing, if an Option is surrendered in
        connection with the exercise of a Stock Appreciation Right, or vice versa,
        the
        number of shares covered thereby shall not be available for grant under the
        Plan.

      

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      6.02           Source
        of Shares.  The shares of Common Stock issued under the Plan
        may be authorized but unissued shares, treasury shares, shares purchased
        by the
        Corporation on the open market or from private sources for use under the
        Plan
        or, if applicable, shares held in a grantor trust created by the
        Corporation.

      

      

      ARTICLE
        VII

      DETERMINATION
        OF

      AWARDS,
        NUMBER OF SHARES, ETC.

      

      The
        Board of Directors or the Committee
        shall, in its discretion, determine from time to time which Employees and
        Non-Employee Directors will be granted Awards under the Plan, the number
        of
        shares of Common Stock subject to each Award, and whether each Option will
        be an
        Incentive Stock Option or a Non-Qualified Stock Option.  In making
        determinations with respect to Employees, there shall be taken into account
        the
        duties, responsibilities and performance of each respective Employee, his
        present and potential contributions to the growth and success of the
        Corporation, his salary and such other factors as the Board of Directors
        or the
        Committee shall deem relevant to accomplishing the purposes of the
        Plan.

      

      

      ARTICLE
        VIII

      OPTIONS
        AND STOCK APPRECIATION RIGHTS

      

      Each
        Option granted hereunder shall be
        on the following terms and conditions:

      

      8.01           Stock
        Option Agreement.  The proper Officers on behalf of the
        Corporation and each Optionee shall execute a Stock Option Agreement which
        shall
        set forth the total number of shares of Common Stock to which it pertains,
        the
        exercise price, whether it is a Non-Qualified Option or an Incentive Stock
        Option, and such other terms, conditions, restrictions and privileges as
        the
        Board of Directors or the Committee in each instance shall deem appropriate,
        provided they are not inconsistent with the terms, conditions and provisions
        of
        this Plan.  Each Optionee shall receive a copy of his executed Stock
        Option Agreement.  Any Option granted with the intention that it will
        be an Incentive Stock Option but which fails to satisfy a requirement for
        Incentive Stock Options shall continue to be valid and shall be treated as
        a
        Non-Qualified Option.

      

      8.02           Awards
        to Employees and Non-Employee Directors.  Specific Awards to
        Employees and Non-Employee Directors shall be made to such persons and in
        such
        amounts as are determined by the Board of Directors or the
        Committee.

      

      8.03           Option
        Exercise Price.

      

      (a)           Incentive
        Stock Options.  The per share price at which the subject
        Common Stock may be purchased upon exercise of an Incentive Stock Option
        shall
        be no less than one hundred percent (100%) of the Fair Market Value of a
        share
        of Common Stock at the time such Incentive Stock Option is granted, except
        as
        provided in Section 8.10(b), and subject to any applicable adjustment pursuant
        to Article IX hereof.

      

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      (b)           Non-Qualified
        Options.  The per share price at which the subject Common
        Stock may be purchased upon exercise of a Non-Qualified Option shall be no
        less
        than one hundred percent (100%) of the Fair Market Value of a share of Common
        Stock at the time such Non-Qualified Option is granted, and subject to any
        applicable adjustment pursuant to Article IX hereof.

      

      8.04           Vesting
        and Exercise of Options.

      

      (a)           General
        Rules.  Incentive Stock Options and Non-Qualified Options
        granted hereunder shall become vested and exercisable at the rate, to the
        extent
        and subject to such limitations as may be specified by the Board of Directors
        or
        the Committee.  Notwithstanding the foregoing, no vesting shall occur
        on or after an Optionee’s employment with or service to the Corporation and all
        Subsidiary Companies is terminated for any reason other than his death or
        Disability.  In determining the number of shares of Common Stock with
        respect to which Options are vested and/or exercisable, fractional shares
        will
        be rounded up to the nearest whole number if the fraction is 0.5 or higher,
        and
        down if it is less.

      

      (b)           Accelerated
        Vesting.  Unless the Board of Directors or the Committee
        shall specifically state otherwise at the time an Option is granted, all
        Options
        granted hereunder shall become vested and exercisable in full on the date
        an
        Optionee terminates his employment with or service to the Corporation or
        a
        Subsidiary Company because of his death or Disability.  In addition,
        all options hereunder shall become immediately vested and exercisable in
        full on
        the date an  Optionee terminates his employment or service to the
        Corporation or a Subsidiary Company as the result of a Change in
        Control.

      

      8.05           Duration
        of Options.

      

      (a)           Employee
        Grants.  Except as provided in Sections 8.05(c) and 8.10,
        each Option or portion thereof shall be exercisable at any time on or after
        the
        date it vests and becomes exercisable until the earlier of (i) ten (10) years
        after its date of grant or (ii) three (3) months after the date on which
        the
        Optionee ceases to be employed by the Corporation and all Subsidiary Companies,
        unless the Board of Directors or the Committee in its discretion decides
        at the
        time of grant to extend such period of exercise upon termination of employment
        from three (3) months to a period not exceeding five (5) years.

      

      (b)           Non-Employee
        Director Grants.  Except as provided in Section 8.05(c), each
        Option or portion thereof shall be exercisable at any time on or after the
        date
        it vests and becomes exercisable until the earlier of (i) ten (10) years
        after
        its date of grant or (ii) the third annual anniversary of the date on which
        the
        Optionee ceases to be a Non-Employee Director.

      

      (c)           Exception
        for Termination Due to Death or Disability.  If an Employee
        dies while in the employ of the Corporation or a Subsidiary Company or
        terminates employment with the Corporation or a Subsidiary Company as a result
        of Disability without having fully exercised his Options, the Optionee or
        the
        executors, administrators, legatees or distributee of his estate shall have
        the
        right, during the twelve-month period following the earlier of his death
        or
        Disability, to exercise such Options to the extent vested on the date of
        such
        death or Disability.  If a Non-Employee Director dies while serving as
        a Non-Employee Director without having fully exercised his Options, the
        Non-Employee Director’s executors, administrators, legatees or distributee of
        his estate shall have the right, during the twelve-month period following
        such
        death, to exercise such Options.  In no event, however, shall any
        Option be exercisable more than ten (10) years (five (5) years for Options
        subject to Section 8.10(b) hereof) from the date it was granted.

      

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      8.06           Nonassignability.  Options
        shall not be transferable by an Optionee except by will or the laws of descent
        or distribution, and during an Optionee’s lifetime shall be exercisable only by
        such Optionee or the Optionee’s guardian or legal
        representative.  Notwithstanding the foregoing, or any other provision
        of this Plan, an Optionee who holds Non-Qualified Options may transfer such
        Options to his or her spouse, lineal ascendants, lineal descendants, or to
        a
        duly established trust for the benefit of one or more of these
        individuals.  Options so transferred may thereafter be transferred
        only to the Optionee who originally received the grant or to an individual
        or
        trust to whom the Optionee could have initially transferred the Option pursuant
        to this Section 8.06.  Options which are transferred pursuant to this
        Section 8.06 shall be exercisable by the transferee according to the same
        terms
        and conditions as applied to the Optionee.

      

      8.07           Manner
        of Exercise.  Options may be exercised in part or in whole
        and at one time or from time to time.  The procedures for exercise
        shall be set forth in the written Stock Option Agreement provided for in
        Section
        8.01 above.

      

      8.08           Payment
        for Shares.  Payment in full of the purchase price for shares
        of Common Stock purchased pursuant to the exercise of any Option shall be
        made
        to the Corporation upon exercise of the Option.  All shares sold under
        the Plan shall be fully paid and nonassessable.  Payment for shares
        may be made by the Optionee in cash or, at the discretion of the Board of
        Directors or the Committee, by delivering shares of Common Stock (including
        shares acquired pursuant to the exercise of an Option) or other property
        equal
        in Fair Market Value to the purchase price of the shares to be acquired pursuant
        to the Option, by withholding some of the shares of Common Stock which are
        being
        purchased upon exercise of an Option, or any combination of the
        foregoing.

      

      8.09           Voting
        and Dividend Rights.  No Optionee shall have any voting or
        dividend rights or other rights of a stockholder in respect of any shares
        of
        Common Stock covered by an Option prior to the time that his name is recorded
        on
        the Corporation’s stockholder ledger as the holder of record of such shares
        acquired pursuant to an exercise of an Option.

      

      8.10           Additional
        Terms Applicable to Incentive Stock Options.  All Options
        issued under the Plan as Incentive Stock Options will be subject, in addition
        to
        the terms detailed in Sections 8.01 to 8.09 above, to those contained in
        this
        Section 8.10.

      

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      (a)           Notwithstanding
        any contrary provisions contained elsewhere in this Plan and as long as required
        by Section 422 of the Code, the aggregate Fair Market Value, determined as
        of
        the time an Incentive Stock Option is granted, of the Common Stock with respect
        to which Incentive Stock Options are exercisable for the first time by an
        Optionee during any calendar year under this Plan and stock options that
        satisfy
        the requirements of Section 422 of the Code under any other stock option
        plan or
        plans maintained by the Corporation (or any parent or Subsidiary Company),
        shall
        not exceed $100,000.

      

      (b)           Limitation
        on Ten Percent Stockholders.  The price at which shares of
        Common Stock may be purchased upon exercise of an Incentive Stock Option
        granted
        to an individual who, at the time such Incentive Stock Option is granted,
        owns,
        directly or indirectly, more than ten percent (10%) of the total combined
        voting
        power of all classes of stock issued to stockholders of the Corporation or
        any
        Subsidiary Company, shall be no less than one hundred and ten percent (110%)
        of
        the Fair Market Value of a share of the Common Stock of the Corporation at
        the
        time of grant, and such Incentive Stock Option shall by its terms not be
        exercisable after the earlier of the date determined under Section 8.05 or
        the
        expiration of five (5) years from the date such Incentive Stock Option is
        granted.

      

      (c)           Notice
        of Disposition; Withholding; Escrow.  An Optionee shall
        immediately notify the Corporation in writing of any sale, transfer, assignment
        or other disposition (or action constituting a disqualifying disposition
        within
        the meaning of Section 421 of the Code) of any shares of Common Stock acquired
        through exercise of an Incentive Stock Option, within two (2) years after
        the
        grant of such Incentive Stock Option or within one (1) year after the
        acquisition of such shares, setting forth the date and manner of disposition,
        the number of shares disposed of and the price at which such shares were
        disposed of.  The Corporation shall be entitled to withhold from any
        compensation or other payments then or thereafter due to the Optionee such
        amounts as may be necessary to satisfy any withholding requirements of Federal
        or state law or regulation and, further, to collect from the Optionee any
        additional amounts which may be required for such purpose.  The
        Committee may, in its discretion, require shares of Common Stock acquired
        by an
        Optionee upon exercise of an Incentive Stock Option to be held in an escrow
        arrangement for the purpose of enabling compliance with the provisions of
        this
        Section 8.10(c).

      

      8.11           Stock
        Appreciation Rights.

      

      (a)           General
        Terms and Conditions.  The Board of Directors or the
        Committee may, but shall not be obligated to, authorize the Corporation,
        on such
        terms and conditions as it deems appropriate in each case, to grant rights
        to
        Optionees to surrender an exercisable Option, or any portion thereof, in
        consideration for the payment by the Corporation of an amount equal to the
        excess of the Fair Market Value of the shares of Common Stock subject to
        the
        Option, or portion thereof, surrendered over the exercise price of the Option
        with respect to such shares (any such authorized surrender and payment being
        hereinafter referred to as a “Stock Appreciation Right”).  Such
        payment, at the discretion of the Board of Directors or the Committee, may
        be
        made in shares of Common Stock valued at the then Fair Market Value thereof,
        or
        in cash, or partly in cash and partly in shares of Common Stock.

      

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      The
        terms and conditions set with
        respect to a Stock Appreciation Right may include (without limitation), subject
        to other provisions of this Section 8.11 and the Plan, the period during
        which,
        date by which or event upon which the Stock Appreciation Right may be exercised
        (which shall be on the same terms as the Option to which it relates pursuant
        to
        Section 8.04 hereunder); the method for valuing shares of Common Stock for
        purposes of this Section 8.11; a ceiling on the amount of consideration which
        the Corporation may pay in connection with exercise and cancellation of the
        Stock Appreciation Right; and arrangements for income tax
        withholding.  The Board of Directors or the Committee shall have
        complete discretion to determine whether, when and to whom Stock Appreciation
        Rights may be granted.  Notwithstanding the foregoing, the Corporation
        may not permit the exercise of a Stock Appreciation Right issued pursuant
        to
        this Plan until the Corporation has been subject to the reporting requirements
        of Section 13 of the Exchange Act for a period of at least one year prior
        to the
        exercise of any such Stock Appreciation Right.

      

      (b)           Time
        Limitations.  If a holder of a Stock Appreciation Right
        terminates service with the Corporation, the Stock Appreciation Right may
        be
        exercised only within the period, if any, within which the Option to which
        it
        relates may be exercised.  Notwithstanding the foregoing, any election
        by an Optionee to exercise the Stock Appreciation Rights provided in this
        Plan
        shall be made during the period beginning on the third business day following
        the release for publication of quarterly or annual financial information
        required to be prepared and disseminated by the Corporation pursuant to the
        requirements of the Exchange Act and ending on the twelfth business day
        following such date.  The required release of information shall be
        deemed to have been satisfied when the specified financial data appears on
        or in
        a wire service, financial news service or newspaper of general circulation
        or is
        otherwise first made publicly available.

      

      (c)           Effects
        of Exercise of Stock Appreciation Rights or Options.  Upon
        the exercise of a Stock Appreciation Right, the number of shares of Common
        Stock
        available under the Option to which it relates shall decrease by a number
        equal
        to the number of shares for which the Stock Appreciation Right was exercised.
        Upon the exercise of an Option, any related Stock Appreciation Right shall
        terminate as to any number of shares of Common Stock subject to the Stock
        Appreciation Right that exceeds the total number of shares for which the
        Option
        remains unexercised.

      

      (d)           Time
        of Grant.  A Stock Appreciation Right shall be granted
        concurrently with the Option to which it relates.

      

      (e)           Non-Transferable.  The
        holder of a Stock Appreciation Right may not transfer or assign the Stock
        Appreciation Right otherwise than by will or in accordance with the laws
        of
        descent and distribution, and during a holder’s lifetime a Stock Appreciation
        Right may be exercisable only by the holder.

      

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      

      ARTICLE
        IX

      ADJUSTMENTS
        FOR CAPITAL CHANGES

      

      9.01    General
        Adjustments.  The aggregate number of shares of Common Stock
        available for issuance under this Plan, the number of shares to which any
        Award
        relates and the exercise price per share of Common Stock under any Award
        shall
        be proportionately adjusted for any increase or decrease in the total number
        of
        outstanding shares of Common Stock issued subsequent to the Effective Date
        of
        this Plan resulting from a split, subdivision or consolidation of shares
        or any
        other capital adjustment, the payment of a stock dividend, or other increase
        or
        decrease in such shares effected without receipt or payment of consideration
        by
        the Corporation.

      

      9.02     Adjustments
        for
        Mergers and Other Corporate Transactions.  If, upon a merger,
        consolidation, reorganization, liquidation, recapitalization or the like
        of the
        Corporation, the shares of the Corporation’s Common Stock shall be exchanged for
        other securities of the Corporation or of another corporation, each Award
        shall
        be converted, subject to the conditions herein stated, into the right to
        purchase or acquire such number of shares of Common Stock or amount of other
        securities of the Corporation or such other corporation as were exchangeable
        for
        the number of shares of Common Stock of the Corporation which such Optionees
        would have been entitled to purchase or acquire except for such action, and
        appropriate adjustments shall be made to the per share exercise price of
        outstanding Awards, provided that in each case the number of shares or other
        securities subject to the substituted or assumed stock options and the exercise
        price thereof shall be determined in a manner that satisfies the requirements
        of
        Treasury Regulation §1.424-1 and the regulations issued under Section 409A of
        the Code so that the substituted or assumed option is not deemed to be a
        modification of the outstanding Options.

      

      

      ARTICLE
        X

      AMENDMENT
        AND TERMINATION OF THE PLAN

      

      The
        Board may, by resolution, at any
        time terminate or amend the Plan with respect to any shares of Common Stock
        as
        to which Awards have not been granted, subject to regulations of the OTS
        and any
        required stockholder approval or any stockholder approval which the Board
        may
        deem to be advisable for any reason, such as for the purpose of obtaining
        or
        retaining any statutory or regulatory benefits under tax, securities or other
        laws or satisfying any applicable stock exchange listing
        requirements.  The Board may not, without the consent of the holder of
        an Award, alter or impair any Award previously granted or awarded under this
        Plan as specifically authorized herein.

      

      

      ARTICLE
        XI

      EMPLOYMENT
        RIGHTS

      

      Neither
        the Plan nor the grant of any
        Awards hereunder nor any action taken by the Committee or the Board in
        connection with the Plan shall create any right on the part of any Employee
        or
        Non-Employee Director of the Corporation or a Subsidiary Company to continue
        in
        such capacity.

      

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      ARTICLE
        XII

      WITHHOLDING

      

      12.01     Tax
        Withholding.  The Corporation may withhold from any cash
        payment made under this Plan sufficient amounts to cover any applicable
        withholding and employment taxes, and if the amount of such cash payment
        is
        insufficient, the Corporation may require the Optionee to pay to the Corporation
        the amount required to be withheld as a condition to delivering the shares
        acquired pursuant to an Award.  The Corporation also may withhold or
        collect amounts with respect to a disqualifying disposition of shares of
        Common
        Stock acquired pursuant to exercise of an Incentive Stock Option, as provided
        in
        Section 8.10(c).

      

      12.02     Methods
        of Tax
        Withholding.  The Board of Directors or the Committee is
        authorized to adopt rules, regulations or procedures which provide for the
        satisfaction of an Optionee’s tax withholding obligation by the retention of
        shares of Common Stock to which the Employee would otherwise be entitled
        pursuant to an Award and/or by the Optionee’s delivery of previously-owned
        shares of Common Stock or other property.

      

      ARTICLE
        XIII

      EFFECTIVE
        DATE OF THE PLAN; TERM

      

      13.01             Effective
        Date of the Plan.  This Plan as originally adopted was
        effective as of the Effective Date, and Awards may be granted hereunder as
        of or
        after the Effective Date and no later than the termination of the
        Plan.  This Plan was approved by the requisite vote of the holders of
        the outstanding voting shares of the Corporation at a meeting of stockholders
        of
        the Corporation held within twelve (12) months of the Effective
        Date.  The amendment and restatement of this Plan was adopted
        effective as of November 20, 2007.

      

      13.02             Term
        of Plan.  Unless sooner terminated, this Plan shall remain in
        effect for a period of ten (10) years ending on the tenth anniversary of
        the
        Effective Date.  Termination of the Plan shall not affect any Awards
        previously granted and such Awards shall remain valid and in effect until
        they
        have been fully exercised or earned, are surrendered or by their terms expire
        or
        are forfeited.

      

                             
        

      ARTICLE
        XIV
        
          	
                   MISCELLANEOUS

                
	 

        

      

       

      

      14.01         
          Governing Law.  To the extent not
        governed by Federal law, this Plan shall be construed under the laws of the
        Commonwealth of Pennsylvania.

      

      14.02             Pronouns.  Wherever
        appropriate, the masculine pronoun shall include the feminine pronoun, and
        the
        singular shall include the plural.

       

       

      
        
          
          

        

        
          12

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