Document:

Settlement Agreement & Mutual General Release

 Exhibit 10.1 
  
 SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE 
  
 This Settlement Agreement
and Mutual General Release (“Settlement Agreement”) is made effective the 12th day of November,
2002, by and between JOHN R. WOLF (“WOLF”), STAAR SURGICAL COMPANY (“Staar”), David Bailey (“Bailey”) and Peter Utrata (“Utrata”) . 
  
 RECITALS 
  
 A.  There
is pending, in the Superior Court of California for the Los Angeles County Superior Court, an Action entitled Wolf v. Staar Surgical Company, and related cross-claims, filed under Case No. BC235396 in which, among other things, WOLF alleges
that Staar, Bailey and Utrata acted wrongfully in connection with certain transactions involving Wolf’s employment at Staar; and where Staar alleges Wolf acted wrongfully at Staar (hereinafter referred to as the “Action”);

  
 B.  There is and has been also pending, in the United States Bankruptcy Court for the Central District
of California (Northern Division) Proofs of Claim filed by WOLF (“WOLF Claim”) and Staar (“Staar Claim”) in connection with the bankruptcy proceeding In re: SALLY M. POLLET, Case No. ND 01-13364RR (“POLLET Bankruptcy
Proceeding”) wherein similar allegations regarding Staar are made; and 
  
 C.  WOLF, Staar, Bailey and
Utrata desire to settle all disputes which exist between them, including, but not limited to those related to the Action, the WOLF Claim and the Staar Claim as it affects Wolf. 
  
 WHEREFORE, for valuable consideration, including the promises as set forth below, WOLF, Staar, Bailey and Utrata (collectively “the Parties”) agree as follows:

 
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 1.  In full settlement and satisfaction of all of the claims and
potential claims of WOLF against Staar, Bailey and Utrata, on the one hand, and Staar, Bailey and Utrata against WOLF, on the other hand, against each or all of them, whether relating to the Action, the WOLF Claim, the Staar Claim, or otherwise, the
Parties agree as follows: 
  

	 	a.
	 
	The Parties agree to complete WOLF’s transfer of 243,067 shares of Staar stock to Staar, in full payment of any and all promissory notes executed by WOLF
in favor of Staar, pursuant to the Form 4 executed May 9, 2000 (the “Transfer”), attached as Exhibit A hereto; 
 

  

	 	b.
	 
	WOLF authorizes Staar to apply, and Staar agrees to apply, the 20,000 shares of Staar stock currently being held by Staar for WOLF’s beneficial interest to
the Transfer; 
 

  

	 	c.
	 
	No later than December 5, 2002, WOLF shall deliver to Staar the remaining 223,067 shares of Staar stock to complete the Transfer; 

  

	 	d.
	 
	Upon WOLF’s delivery pursuant to 1.c., above, any and all promissory notes executed by WOLF in favor of Staar are thereby paid in full and Staar shall have
no further rights thereunder; 
 

  

	 	e.
	 
	No later than December 6, 2002, the Parties shall dismiss with prejudice any and all actions in the Los Angeles Superior Court, United States Bankruptcy Court
or any other court, and do any act necessary under the rules and statutes to effectuate this settlement including but not limited to filing Requests for Dismissal; 
 

  

	 	f.
	 
	The Parties agree that all terms and conditions of this Settlement Agreement shall remain non-public and confidential through and 

 
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 including the filing of dismissals pursuant to 1.e., above, and that the Parties shall mutually agree to the language of
the press release announcing this settlement; and 
  

	 	g.
	 
	The Parties hereby agree that the Court in the Action shall retain jurisdiction to enforce the terms of this Settlement Agreement pursuant to California Code of
Civil Procedure section 664.6. 
 

  
 2.  General Release of All Claims by WOLF, Staar,
Bailey and Utrata. 
  

	 	a.
	 
	WOLF for himself and on behalf of his present and former agents, employees, employers, officers and directors, corporations (including, but not limited to,
professional corporations), parent and subsidiary corporations, partners, joint venturers, heirs, spouses, children, relatives, issue, estates, beneficiaries, representatives, executors, administrators, current attorneys, trustors, trustees,
insurers, predecessors, successors and assigns, and each of them, and all those claiming by, through, under or in concert with them or any of them (collectively "WOLF Releasing Parties"), hereby absolutely, forever and fully, generally and
specifically, releases and discharges Staar, Bailey and Utrata and their respective present and former agents, employees, employers, officers and directors, corporations (including, but not limited to, professional corporations), parent and
subsidiary corporations, partners, joint venturers, heirs, spouses, children, relatives, issue, estates, beneficiaries, representatives, executors, administrators, current attorneys (excluding Pollet & Richardson and Pollet, Richardson &
Patel), trustors, trustees, insurers, predecessors, 
 

 
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 successors and assigns, and each of them, and all those claiming by, through,
under or in concert with them or any of them (collectively “Staar, Bailey and Utrata Released Parties”), from any and all claims, contentions, rights, debts, liabilities, demands, accounts, reckonings, obligations, duties, promises, costs,
expenses (including, but not limited to, attorneys’ fees), liens, subrogation rights, indemnification rights, damages, losses, actions, and causes of action, of any kind whatsoever whether asserted by way of affirmative claims or causes of
action, affirmative defenses, offset or otherwise in any proceeding whatsoever whether due or owing in the past, present or future and whether based upon contract, tort, statute or any other legal or equitable theory of recovery, and whether known
or unknown, suspected or unsuspected, fixed or contingent, matured or unmatured, with respect to, pertaining to, or arising from any matters, acts, omissions, events, conduct or occurrences at any time prior to the date of this Settlement Agreement,
including, without limiting the generality of the foregoing provisions, any and all causes of action or claims referred to or based upon the facts alleged in the Action, the WOLF Claim, the Staar Claim and any affirmative defenses or claims of
offset based thereon. 
  

	 	b.
	 
	Staar, Bailey and Utrata, for themselves and on behalf of their respective present and former agents, employees, employers, officers and directors, corporations
(including, but not limited to, professional corporations), parent and subsidiary corporations, partners, joint venturers, heirs, spouses, children, relatives, issue, estates, beneficiaries, representatives, executors, 

 
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 administrators, current attorneys, trustors, trustees, insurers, predecessors, successors and assigns, and each of them,
and all those claiming by, through, under or in concert with them or any of them (collectively “Staar, Bailey and Utrata Releasing Parties”), hereby absolutely, forever and fully, generally and specifically, releases and discharges WOLF
and his respective present and former agents, employees, employers, officers and directors, corporations (including, but not limited to, professional corporations), parent and subsidiary corporations, partners, joint venturers, heirs, spouses,
children, relatives, issue, estates, beneficiaries, representatives, executors, administrators, current attorneys (excluding Pollet & Richardson, and Pollet, Richardson & Patel), trustors, trustees, insurers, predecessors, successors and
assigns, and each of them, and all those claiming by, through, under or in concert with them or any of them (collectively “WOLF Released Parties”), from any and all claims, contentions, rights, debts, liabilities, demands, accounts,
reckonings, obligations, duties, promises, costs, expenses (including, but not limited to, attorneys’ fees), liens, subrogation rights, indemnification rights, damages, losses, actions, and causes of action, of any kind whatsoever whether
asserted by way of affirmative claims or causes of action, affirmative defenses, offset or otherwise in any proceeding whatsoever whether due or owing in the past, present or future and whether based upon contract, tort, statute or any other legal
or equitable theory of recovery, and whether known or unknown, suspected or unsuspected, fixed or contingent, matured or 

 
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	unmatured, with respect to, pertaining to, or arising from any matters, acts, omissions, events, conduct or occurrences at any time prior to the date of this
Settlement Agreement, including, without limiting the generality of the foregoing provisions, any and all causes of action or claims referred to or based upon the facts alleged in the Action, the WOLF Claim, the Staar Claim and any affirmative
defenses or claims of offset based thereon. 
 

  

	 	c.
	 
	Notwithstanding anything in 2.a. and 2.b., above, the Parties do not release Pollet & Richardson, or Pollet, Richardson & Patel or any individual
attorney associated therewith, in any regard whatsoever. 
 

  
 3.    Waiver
of Civil Code Section 1542. The Parties and each of them, hereby waive any and all rights or benefits which any of them may have under Section 1542 of the Civil Code of the State of California, providing that: 
  
 “A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.” 
  
 The Parties, and each of them, hereby represent and warrant, and each of them, that they understand the effect of this waiver of said Civil Code section and that they are represented and have been advised in this General
Release by an attorney licensed to practice law in the State of California. 

 
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 4.    Release of Unknown Claims.  The
Parties, and each of them, acknowledge that they, or any of them, may hereafter discover Claims and/or facts now unknown or unsuspected, or in addition to, or different from, those which the Parties now know or believe to be true with respect to
this Mutual and General Release. Nevertheless, the Parties, and each of them, intend by this Mutual and General Release to release fully, finally, and forever all Claims released hereby. Accordingly, this Mutual and General Release shall remain in
full force as a complete release of such Claims notwithstanding the discovery or existence of any such additional or different Claims and/or facts before or after the date of this Settlement Agreement. 
  
 5.    Representation and Warranty by Releasing Parties.  The Parties, and each of them, represent and
warrant, that they (a) are the lawful owners of everything released hereunder, (b) have all necessary power and authority to make such release, including any necessary consent or approval from any person or Board of Directors and including the
absence of any duty or obligation that would prevent, or be put in breach or default by, such release, and (c) have not heretofore transferred or attempted to transfer all or any part of any such thing released in any manner whatsoever, including by
way of subrogation or operation of law. The Parties, and each of them, shall indemnify and hold each of the other Parties harmless with respect to any liability, cost, expense, or claim with respect to, pertaining to, or arising from any assertion
of any such obligation or transfer or lack of such power or authority including, but not limited to, reasonable attorneys’ fees and costs. The Parties, and each of them, represent and warrant further to each other, that this Mutual and General
Release is executed voluntarily, and without duress or undue influence on the part of or on behalf of the Parties, or any other person or entity whatsoever. 

 
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 6.    Representations and Warranties of Each
Party.  Each Party hereto represents and warrants to the other Party or Parties that he, she or it has the full power and authority to execute, deliver and perform under this Settlement Agreement and all documents referred to herein,
and that any needed consent or approval from any other person has been obtained, including, but not limited to, valid corporate franchise and approval of the board of directors for any corporate party, and including the absence of any duty or
obligation that would prevent, or be put in breach or default by, such execution, delivery or performance; and each Party shall indemnify and hold the other Party or Parties harmless with respect to any and all liability, cost, expense (including
reasonable attorneys’ fees), or claim with respect to, pertaining to, or arising from any assertion of any such obligation or lack of such power or authority. 
  
 7.    Compromise of Disputed Claim; No Admissions.  This Agreement constitutes a compromise and settlement of claims which are denied
and contested and nothing in this Settlement Agreement, or any document referred to herein, nor any act (including, but not limited to, the execution of this Settlement Agreement and/or in the consideration for this Settlement Agreement) of any
Party hereto, nor any transaction occurring between any Parties hereto prior to the date hereof, is or shall be treated, construed or deemed as an admission by any Party hereto of any liability, fault, responsibility, or guilt of any kind to any
other Party hereto or to any person, as to any allegation or claim in the various actions or otherwise, for any purpose whatsoever, all such liability, fault, responsibility and guilt of any kind being expressly denied. 
  
 8.    Binding Effect.  The settlement, and this Settlement Agreement and all documents referred to
herein, shall bind and inure to the benefit of each of the Parties hereto 

 
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 and the Released Parties and their respective successors in interest. This Settlement Agreement is not for the benefit of any person not a Party
hereto or specifically identified as a beneficiary herein or specifically identified herein as a person or entity released hereby, and is not intended to constitute a third party beneficiary contract. 
  
 9.      Final Integrated Agreement.  This Settlement Agreement and the documents referred
to herein constitute the entire, final and binding understanding between the Parties hereto; that no other statement or representation, written or oral, express or implied, has been received or relied upon in the settlement, and that all prior
discussions, statements and negotiations made or which have occurred prior to the date of the Settlement Agreement shall be deemed merged into this Settlement Agreement and the documents referred to herein, and shall not be used for any other
purpose whatsoever. 
  
 10.    Understanding of Agreement.  Each Party hereto
understands and agrees to the terms and conditions contained in this Settlement Agreement and in the documents referred to herein, and has relied upon his, her or its own judgment, belief, knowledge, understanding and expertise after careful
consultation with his, her or its own legal counsel concerning the legal effect of the settlement and all of the terms of this Settlement Agreement. 
  
 11.    Voluntary Settlement.  Each Party hereto enters into the settlement, this Settlement Agreement and the documents referred to herein, knowingly and
voluntarily, in the total absence of any fraud, mistake, duress, coercion, or undue influence and after careful thought and reflection upon the settlement, this Settlement Agreement and the documents referred to herein; and accordingly, by signing
this document and the documents referred to herein, each signifies full understanding, agreement and acceptance. 

 
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 12.  Investigation of Facts.    Each Party
hereto has investigated the facts pertaining to the settlement and the Settlement Agreement and all matters pertaining thereto as deemed necessary by each. Each Party hereto fully assumes the risk that the investigation they have conducted, if any,
relating to all matters herein may be inadequate in that the facts with respect to which this Settlement Agreement is executed may hereafter be found to be different from the facts which such Party now believes to be true. Each Party assumes the
risk of such possible differences of facts and hereby agrees that this Settlement Agreement shall remain in effect notwithstanding such difference of fact. 
  
 13.  No Additional Representations.    Except as may be set forth in this Settlement Agreement, no statement or representation, written or oral, express or implied,
has been made to the Parties by any of the other Parties, or any of their respective agents, representatives, employees, attorneys or any other person regarding any matter, including, but not limited to, the federal or state income tax consequences
of the Settlement Agreement to any Party. Each of the Parties expressly acknowledges and agrees that each shall be responsible for their own taxes arising out of this Settlement Agreement and that each has relied solely upon the advice of their own
attorneys and/or accountants as to the tax consequences of the Settlement Agreement. 
  
 14.  No Other
Actions.    The Parties have not commenced or prosecuted and will not commence or prosecute any other action or proceeding for recovery of damages or for any form of equitable relief, declaratory relief or any other form of
action or proceeding or arbitration against any Party or other person based upon the Claims released in this Settlement Agreement, including, but not limited to, the Claims that are the subject of the Action and in the POLLET Bankruptcy Proceeding
or any other action. This Settlement Agreement shall 

 
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 constitute a judicial bar to the institution of any such action or proceeding or any assignment thereof. 
  
 15.  Ambiguities or Uncertainties.    The settlement, this Settlement Agreement and the documents
referred to herein, and any ambiguities or uncertainties herein or therein, shall be equally and fairly interpreted and construed without reference to the identity of the Party or Parties preparing this document or the documents referred to herein,
on the express understanding and agreement that the Parties participated equally in the negotiation and preparation of the Settlement Agreement and the documents referred to herein, or have had equal opportunity to do so. Accordingly, the Parties
hereby waive the benefit of California Civil Code Section 1654 and any successor or amended statute, providing that in cases of uncertainty, language of a contract should be interpreted most strongly against the Party who caused the
uncertainty to exist. 
  
 16.  Survival of Executory Provisions.    Any and all
executory provision under this Settlement Agreement and the documents referred to herein shall survive the consummation of this Settlement Agreement and shall continue in full force and effect until fully performed and satisfied. 

 
 17.  Attorneys’ Fees and Costs.    Each Party hereto shall bear his, her or its own
attorneys’ fees and costs. 
  
 18.  Attorneys’ Fees/Prevailing
Party.    In any action or proceeding or motion between or among the Parties hereto at law or in equity with respect to, pertaining to, or arising from the settlement, including this Settlement Agreement or any document
referred to herein, whether for enforcement, or for damages by reason of any alleged breach, or for a declaration of rights or obligations, or otherwise, and including any appeal, contempt proceeding, 

 
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 bankruptcy proceeding, and any action or proceeding to enforce and/or collect any judgment or other relief granted, whether or not such action
or proceeding is compromised or is prosecuted to final judicial determination (collectively “Litigation”), the unsuccessful party to the Litigation shall pay to the prevailing party, in addition to any other relief that may be granted, all
costs and expenses of the Litigation, including, without limitation, the prevailing party’s actual attorneys’ fees and expenses. “Attorneys’ fees and expenses” includes, without limitation, paralegals’ fees and
expenses, attorneys’ consultants’ fees and expenses, expert witnesses’ fees and expenses, and all other expenses incurred by the prevailing party’s attorneys in the course of their representation of the prevailing party in
anticipation of and/or during the course of the Litigation, whether or not otherwise recoverable as “attorney’s fees” or as “costs” under California law; and the same may be sought and awarded in accordance with California
procedure as pertaining to an award of contractual attorneys’ fees. The Court in the Action retains jurisdiction pursuant to California Code of Civil Procedure section 664.6. 
  
 19.  California Law.    The settlement, this Settlement Agreement, and the documents referred to herein, shall be governed by and
construed and interpreted in accordance with, the laws of the State of California. In the language of this document and the documents referred to herein, the singular and plural numbers, and the masculine, feminine and neutral genders, shall each be
deemed to include all others, and the word “person” shall be deemed to include corporations and every other entity, as the context may require. 
  
 20.  Severability.    In the event that any provision of this Settlement Agreement should be held to be void, voidable or unenforceable, the remaining portions
hereof shall remain in full force and effect. 
  

 
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 21.  Waiver, Modification and
Amendment.    No breach of this Settlement Agreement or of any provision herein can be waived except by an express written waiver executed by the Party waiving such breach. Wavier of any one breach shall not be deemed a
waiver of any other breach of the same or other provisions of this Settlement Agreement. The Settlement Agreement may be amended, altered, modified or otherwise changed in any respect or particular only by new consideration and a writing duly
executed by the Parties hereto or their authorized representatives. 
  
 22.  Effective Date/Additional
Documents.    This Settlement Agreement shall be effective as of the date first above written, upon execution by the last of the Parties, but without regard to the date of execution. The Parties shall execute any additional
documents reasonably necessary to effectuate the intent and purposes of this Settlement Agreement. 
  
 23.  Notices.    All notices under this Settlement Agreement shall be in writing and shall be deemed effective on the date of delivery if delivered personally (and a receipt obtained therefor), or
on the third calendar day after mailing if mailed by first class mail, registered or certified, postage prepaid; and shall be addressed as follows, or as may be amended by a communication delivered pursuant to this paragraph 30): 

 
 
	 To WOLF:
 	  	 John Wolf
 1496 Bedford Road
 San Marino, CA 91108
 Telephone: (626) 792-2083
 
	  	  	  
	 With a copy to:
 	  	 Marvin L. Rudnick, Esq.
 42 East Colorado Boulevard, 2nd Floor
 Pasadena, CA 91105-3794

Telephone: (626) 796-7799
 
	  	  	  
	 To Staar or Bailey:
 	  	 David C. Scheper, Esq.
 Winston & Strawn
 333 So. Grand Avenue, 38th Floor
 

 

 
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	  	 	 Los Angeles, CA 90071-1543
 
	  	 	 Telephone: (213) 615-1700
 
	 
	 With a copy to:
 	 	 David Bailey, President
 
	  	 	 STAAR Surgical Company
 
	  	 	 1991 Walker Avenue
 
	  	 	 Monrovia, CA 91016
 
	 
	 To Utrata:
 	 	 Peter Utrata, M.D.
 
	  	 	 1289 Arlington Avenue
 
	  	 	 Columbus, OH 43232
 
	 
	 With a copy to:
 	 	 Kelley B. Poleynard, Esq.
 
	  	 	 Overland & Borenstein LP
 
	  	 	 6060 Center Drive, 7th Floor
 
	  	 	 Los Angeles, CA 90045- Telephone (310) 215-6580
 
	  	 	  

 
 24.     Captions. Section, paragraph and other captions or headings contained in
this Settlement Agreement are inserted as a matter of convenience and for reference, and in no way define, limit, extend or otherwise describe the scope or intent of this Settlement Agreement or any provision hereof and shall not affect in any way
the meaning or interpretation of this Settlement Agreement. 
  
 25.     Execution in Several
Counterparts. This Agreement may be executed in several counterparts and as so executed, shall constitute one agreement binding on all the Parties, notwithstanding that all the Parties are not signatories to the original or same counterparts.

  
 IN WITNESS WHEREOF, the Parties to this Settlement Agreement execute this Settlement Agreement as of the day and
year first above written. 
  
 DATE: November 12, 2002 
 
	 
	 /s/    John R. Wolf         
 

	 JOHN R. WOLF
 

 
  
 DATE: November 12, 2002 

 
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	 /s/ John C. Bily        
 

	   John C. Bily, Chief Financial Officer, on
   behalf of Staar Surgical Company
 

 
 DATE: November 12, 2002 
  
 
	 
	 /s/ David Bailey        
 

	 David Bailey
 

 

	

  
 DATE: November 12, 2002 
  
 
	 
	 /s/ Peter Utrata         
 

	 Peter Utrata
 

 

 
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 APPROVED AS TO FORM AND CONTENT: 
  
 LAW OFFICES OF MARVIN L. RUDNICK 
  
 
	 
	 By:
 	 	 /s/ Marvin L. Rudnick, Esq.       
 

	  	 	   Marvin L. Rudnick, Esq.
   Attorney for JOHN R. WOLF
 

 
  
 WINSTON & STRAWN 
  
 
	 
	 By:
 	 	 /s/ Diann H. Kim       
 

	  	 	   Diann H. Kim, Esq.
   Attorney for Staar and David Bailey
 

 
  
 
	 
	 By:
 	 	 /s/ Kelly B. Poleynard         
 

	  	 	   Kelley B. Poleynard, Esq.
   Attorney for Peter Utrata
 

 

 
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                                                                    EXHIBIT 10.1
                        Standstill and Voting Agreement

     This Standstill and Voting Agreement (this "Agreement") dated as of
December 5, 2002, is among Kankakee Bancorp, Inc., a Delaware corporation (the
"Company"), and the Company's Board of Directors (the "Board"), on one hand, and
Jeffrey L. Gendell, Tontine Management L.L.C., TOntine Partners L.P., Tontine
Financial Partners, L.P. and Tontine Overseas Associates, L.L.C. (collectively,
the "Group," and individually, a "Group Member"), on the other hand.

                                    Recitals

     Whereas, the Company and the Group have agreed that it is in their mutual
interests to enter into this Agreement as hereinafter described;

     Now therefore, in consideration of the Recital and the representations,
warranties, covenants and agreements contained herein and other good and
valuable consideration, the parties hereto mutually agree as follows:

                                   Agreements

     Section 1.   Definitions. As used in this Agreement, the following terms
shall have the meanings indicated, unless the context otherwise requires:

             (a)  "Acquire" means every type of acquisition, whether effected by
purchase, exchange, operation of law or otherwise.

             (b)  "Acting in concert" means: (i) knowing participation in a
joint activity or conscious parallel action towards a common goal whether or not
pursuant to an express agreement; or (ii) a combination of pooling of voting or
other interests in the securities of an issuer for a common purpose pursuant to
any contract, understanding, relationship, agreement or other arrangement,
whether written or otherwise.

             (c)  "Affiliate" means a person or entity that directly, or
indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with, one or more of the Group Members.

             (d)  "Bank" means KFS Bank, F.S.B., a federal savings bank with its
main office located in Kankakee, Illinois, which was formerly known as Kankakee
Federal Savings Bank.

             (e)  "Beneficial ownership" or "beneficially owned" mean all
capital securities of the Company owned or held in the name of a Group Member or
an associate thereof, individually or jointly with any other person; by any
trust in which the Group Member is a settlor, trustee or beneficiary; by any
corporation (whose shares are not publicly traded) in which the Group Member is
a stockholder (owning, together with all other Group Members and their
respective affiliates, more than five percent (5%) of the outstanding voting
power thereof), director or officer; by any partnership (whose partnership
interests are not publicly traded) in which the Group Member is a limited
partner (owning, together with all other Group Members and their respective
affiliates, more than five percent (5%) of the outstanding beneficial interests
thereof), or a general partner, employee or agent; or by any other entity in
which a Group Member holds, together with all other Group Members and their
respective affiliates, more than five percent (5%) of the outstanding beneficial
interests thereof.

             (f)  "Business day" means any day except Saturday, Sunday and any
day on which the Bank is authorized or required by law or other government
action to close.

             (g)  "Change in control" means: (i) any person or group becomes
the beneficial owner of any class of voting securities of the Company or the
Bank representing ten percent (10%) or more of the total number of votes that
may be cast for the election of the directors of the Company or the Bank; (ii)
in connection with any tender or exchange offer (other than an offer by the
Company or the Bank), merger or other business

<PAGE>

combination, sale of assets or contested election, or any combination of the
foregoing, the persons who were directors of the Company or the Bank prior to
any such action cease to be a majority of the members of the board of directors
of the Company or the Bank, respectively; or (iii) stockholders of the Company
or the Bank approve a transaction pursuant to which substantially all of the
assets of the Company or the Bank will be sold.

             (h)  "Control" (including the terms "controlling," "controlled by,"
and "under common control with") means the possession, direct or indirect,
of the power to direct or cause the direction of the management, activities or
policies of a person or organization, whether through the ownership of capital
securities, by contract or otherwise.

             (i)  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

             (j)  "Person" includes an individual, group acting in concert,
a corporation, a partnership, an association, a joint stock company, a trust, an
unincorporated organization or similar company, a syndicate or any other group
formed for the purpose of acquiring, holding or disposing of the equity
securities of the Company.

             (k)  "Transfer" means, directly or indirectly, to sell, gift,
transfer, assign, pledge, encumber, hypothecate or similarly dispose of (by
operation of law or otherwise), either voluntarily or involuntarily, or to enter
into any contract, option or other arrangement or understanding with respect to
the sale, gift, transfer, assignment, pledge, encumbrance, hypothecation or
similar disposition of (by operation of law or otherwise), any capital
securities, or any interest in any capital securities, of the Company; provided,
however, that a merger or consolidation in which the Company is a constituent
corporation shall not be deemed to be the transfer of any of the Company's
capital securities beneficially owned by the Group or a Group Member.

             (l)  "Vote" means to vote in person or by proxy, or to give or
authorize the giving of any consent as a stockholder on any matter.

     Section 2.   Representations and Warranties of the Group Members. The Group
Members hereby represent and warrant to the Company as follows:

             (a) The Group and the Group Members, in the aggregate, beneficially
own, as of the date of this Agreement, 114,600 shares of the Company's common
stock, par value $0.01 per share. Except for these shares, neither the Group nor
any Group Member, nor any of their respective affiliates, has or has a right to
acquire any beneficial ownership interest in any capital securities of the
Company, and no such person has a right to vote any capital securities of the
Company.

             (b) The Group and the Group Members have full power and
authority to enter into and perform their obligations under this Agreement, and
the execution and delivery of this Agreement by the Group and Group Members has
been duly authorized by the principals of the Group. This Agreement constitutes
a valid and binding obligation of the Group and the Group Members, subject to
the non-objection of the Office of Thrift Supervision ("OTS"), and the
performance of its terms shall not constitute a violation of any limited
partnership agreement, bylaws or any agreement or instrument to which the Group
or any Group Member is a party.

             (c) There are no other persons who, by reason of their personal,
business, professional or other arrangement with the Group or any Group Member,
whether written or oral and whether existing as of the date hereof or in the
future, have agreed, explicitly or implicitly, to take any action on behalf of
or in lieu of the Group or any Group Member that would otherwise be prohibited
by this Agreement.

             (d) Except for this Agreement, there are no arrangements,
agreements or understandings concerning the subject matter of this Agreement
between the Group (and/or any Group Member) and the Company.

     Section 3.   Representations and Warranties of the Company. The Company
hereby represents and warrants to the Group that the Company has full power and
authority to enter into and perform its obligations under this Agreement, and
that the execution and delivery of this Agreement by the Company has been duly
authorized by the Board. This Agreement constitutes a valid and binding
obligation of the Company and the Board

                                       2

<PAGE>

and the performance of its terms shall not constitute a violation of the
Company's certificate of incorporation, bylaws or any agreement or instrument to
which it is a party.

     Section 4.   Covenants.

                  (a) Subject to subparagraph (b) of this Section, from the date
of this Agreement through the Expiration Date (as defined below), the Group and
each Group Member covenant and agree not to, and shall cause each of their
affiliates not to, directly or indirectly, alone or in concert with any other
affiliate, group or other person:

                      (i)   acquire, offer or propose to acquire or agree to
acquire, directly or indirectly, whether by purchase, tender or exchange offer,
or through the acquisition of control of another person or entity (including by
way of merger or consolidation), the beneficial ownership of, or the right to
vote, any voting securities, direct or indirect rights or options to acquire any
voting securities, or securities or instruments convertible into voting
securities, of the Company if, after giving effect to the acquisition of such
voting securities (whether or not actually acquired), the Group would
beneficially own (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) in excess of 9.99% of the outstanding voting securities of the
Company; provided, however, that any increase in the Group's percentage
ownership of voting securities of the Company due to a redemption or repurchase
by the Company of any of its voting securities shall not be deemed to be an
acquisition by the Group of beneficial ownership of the Company's voting
securities;

                      (ii)   transfer, or offer or propose to transfer or agree
to transfer, except in compliance with this Agreement, beneficial ownership of,
or the right to vote any capital securities of the Company owned as of the date
of this Agreement or hereafter acquired, whether acquired through the purchase
of any of the Company's capital securities, the acquisition of control of
another person or entity (including by way of merger or consolidation), or by
joining a partnership, syndicate or other group or otherwise, and the Group and
each Group member acknowledge and agree that any of the Company's capital
securities beneficially owned by them, whether acquired in compliance with or in
contravention of this Agreement, with or without actual knowledge, shall be
subject to the terms and conditions of this Agreement;

                      (iii)  propose or seek to effect a merger, consolidation,
recapitalization, reorganization, sale, lease, exchange or other disposition of
substantially all the assets of or other business combination involving, or a
tender or exchange offer for securities of, the Company or any of its
subsidiaries or any material portion of its or such subsidiary's business or
assets or any other type of transaction that would result in a change in control
of the Company (any such action in this subparagraph being referred to herein as
a "Company Transaction Proposal");

                      (iv)   seek to exercise any control or influence over the
management of the Company or the Board or any of the businesses, operations or
policies of the Company;

                      (v)    present to the Company, its stockholders or any
third party any proposal constituting or that can reasonably be expected to
result in a Company Transaction Proposal;

                      (vi)   seek to effect a change in control of the Company;

                      (vii)  publicly suggest or announce its willingness or
desire to engage in a transaction or group of transactions or have another
person engage in a transaction or group of transactions that constitute or could
reasonably be expected to result in a Company Transaction Proposal, or take any
action that might require the Company to make a public announcement regarding
any such Company Transaction Proposal;

                      (viii) initiate, request, induce, encourage or attempt to
induce or give encouragement to any other person to initiate, or otherwise
provide assistance to any person who has made or is contemplating making, or
enter into discussions or negotiations with respect to, any proposal
constituting or that can reasonably be expected to result in a Company
Transaction Proposal;

                                       3

<PAGE>

                      (ix)   solicit proxies (or written consents) or assist or
participate in any other way, directly or indirectly, in any solicitation of
proxies (or written consents), or otherwise become a "participant" in a
"solicitation," or assist any "participant" in a "solicitation" (as such terms
are defined under the Exchange Act) in opposition to the recommendation or
proposal of the Board, or recommend or request or induce or attempt to induce
any other person to take any such actions, or seek to advise, encourage or
influence any other person with respect to the voting of (or the execution of a
written consent in respect of) any capital securities of the Company, or execute
any written consent in lieu of a meeting of the holders of any capital
securities of the Company or grant a proxy with respect to the voting of any
capital securities of the Company to any person other than a member of the
Board;

                      (x)    initiate, propose, submit, encourage or otherwise
solicit stockholders of the Company for the approval of one or more stockholder
proposals or induce or attempt to induce any other person to initiate any
stockholder proposal, or seek election to or seek to place a representative or
other affiliate or nominee on the Board or seek removal of any member of the
Board;

                      (xi)   form, join in or in any other way (including by
deposit of the Company's capital securities) participate in a partnership,
pooling agreement, syndicate, voting trust or other group with respect to any of
the Company's capital securities, or enter into any agreement or arrangement or
otherwise act in concert with any other person, for the purpose of acquiring,
holding, voting or disposing of any of the Company's capital securities;

                      (xii)  join with or assist any person or entity, directly
or indirectly, in opposing, or make any statement in opposition to, any proposal
or director nomination submitted by the Board to a vote of the Company's
stockholders;

                      (xiii) join with or assist any person or entity, directly
or indirectly, in supporting or endorsing (including supporting, requesting or
joining in any request for a meeting of stockholders in connection with), or
make any statement in favor of, any proposal submitted to a vote of the
Company's stockholders that is opposed by the Board;

                      (xiv)  vote for any nominee or nominees for election to
the Board, other than those nominated or supported by the Board, and no Group
Member shall consent to become a nominee for election as a director of the
Company, without the express written consent of the Company;

                      (xv)   call, or participate in calling, any special
meeting of the stockholders of the Company;

                      (xvi)  make any public statement, whether by press
release, comment to any news media or otherwise, regarding the affairs of the
Company or that reflects negatively against the Company or any subsidiary or the
Board or any subsidiary or any of the directors or officers of the Company or
any subsidiary; or

                      (xvii) advise, assist, encourage or finance (or arrange,
assist or facilitate financing to or for) any other person in connection with
any of the matters restricted by, or otherwise seek to circumvent the
limitations of, this Agreement.

               (b)    From the date of this Agreement and through the conclusion
of the Company's annual meeting of stockholders to be held in 2003, the Group
and each Group Member covenant and agree, and shall require each of their
affiliates, to vote and shall require any affiliate, group or other person
acting in concert with any Group Member to vote, all shares beneficially owned
in accordance with the recommendations of a majority of the members of the Board
then in office on any stockholder proposals that are made and on approval of
auditors.

         Section 5.   Directorship.

                  (a) The Company and the Board covenant and agree to increase
at its regularly scheduled board meeting to be held in December, 2002, the
number of directors from seven (7) to eight (8) members, to appoint a nominee
designated by the Group (the "Nominee") to fill the vacancy created by such
increase and to

                                       4

<PAGE>

provide that the Nominee's term will expire at the Company's annual meeting of
stockholders to be held in 2004 (the "2004 Annual Meeting"), subject only to the
non-objection of the OTS to such appointment.

                  (b) The Company shall, upon execution of this Agreement,
notify the OTS in accordance with 12 C.F.R. (S) 563.60 et seq. of the
appointment of the Nominee to the Board, and shall promptly take any and all
other actions necessary to obtain, including the filing of any required notices,
forms or other instruments with the OTS and any other regulatory authority
having jurisdiction thereof, the approval or non-objection of which is required
for the Nominee to serve on the Board. The Group shall cause the Nominee to
provide such information as may reasonably be requested by the Company in order
for the Company to fulfill its obligations under 12 C.F.R. (S) 563.60 et seq.

                  (c) It is expressly agreed that the Nominee is not bound, and
no Replacement Director (as defined below) shall be bound, by the covenants,
obligations and duties imposed upon the Group in this Agreement with respect to
any actions taken by the Nominee or any Replacement Director solely in his or
her capacity as a director of the Company.

                  (d) If the OTS for any reason objects to the inclusion of the
Nominee on the Board, or if the Nominee for any reason terminates service as a
director of the Company prior to the 2004 Annual Meeting, the Company agrees to
appoint a replacement director selected by the Group (the "Replacement
Director"), subject to the approval of the remaining members of the Board, which
approval shall not be unreasonably withheld, to fill the resulting vacancy. All
of the provisions of this Section shall apply to any Replacement Director.

                  (e) In the event that the appointment of the Nominee or any
Replacement Director is not approved by the OTS within 90 days of delivery by
the Group or any Group Member to the Company of completed and executed forms and
disclosures necessary for submission to the OTS, this Agreement shall promptly
terminate.

         Section 6.   Notice of Breach, Remedies and Attorneys' Fees.

                  (a) The parties acknowledge the generally accepted principle
that a material breach by one party to a contract excuses further performance by
the other, but they expressly agree that an actual or threatened breach of this
Agreement by any party will give rise to irreparable injury that cannot
adequately be compensated by damages. Accordingly, in addition to any other
remedy to which it may be entitled, each party shall be entitled to seek a
temporary restraining order or injunctive relief to prevent a breach of the
provisions of this Agreement or to secure specific enforcement of its terms and
provisions.

                  (b) The Group (and each Group Member) expressly agree that
they will not be excused or claim to be excused from performance under this
Agreement as a result of any material breach by the Company unless and until the
Company is given written notice of such breach and ten (10) business days during
which time the Company may either cure such breach or obtain equitable relief.
If the Company seeks equitable relief, the Group (and each Group Member)
irrevocably stipulate that any failure to perform or any assertion by the Group
(or any Group Member) that they are excused from performing their obligations
under this Agreement would cause the Company irreparable harm, that the Company
shall not be required to provide further proof of irreparable harm in order to
obtain equitable relief and that the Group (and each Group Member) shall not
deny or contest that such actions would cause the Company irreparable harm. If,
after such ten (10) business day period, the Company has not either reasonably
cured such material breach or obtained equitable relief, the Group (or any Group
Member) may terminate this Agreement by delivery of written notice to Company.

                  (c) The Company expressly agrees that it will not be excused
or claim to be excused from performance under this Agreement as a result of any
material breach by the Group (or any Group Member) unless and until the Group
(and each Group Member) is given written notice of such breach and ten (10)
business days during which time the Group (or any Group Member) may either cure
such breach or obtain equitable relief. If the Group (or any Group Member) seeks
equitable relief, the Company irrevocably stipulates that any failure to perform
or any assertion by the Company that it is excused from performing its
obligations under this Agreement would cause the Group (and each Group Member)
irreparable harm, that the Group (or any Group Member) shall not be required to
provide further proof of irreparable harm in order to obtain equitable relief
and that the Company shall

                                        5

<PAGE>

not deny or contest that such actions would cause the Group (and each Group
Member) irreparable harm. If, after such ten (10) business day period, the Group
(or the Group Member) has not either reasonably cured such material breach or
obtained equitable relief, the Company may terminate this Agreement by delivery
of written notice to the Group and each Group Member.

                  (d) If any party institutes an action to interpret this
Agreement, or to enforce its rights under or recover damages for breach of, this
Agreement, the prevailing party in such action or appeal shall be awarded all
costs and expenses of the litigation, including, but not limited to, attorneys'
fees, filing and service fees and witness fees. The prevailing party will be the
party that succeeds either affirmatively or defensively on claims having the
greatest value or importance, as determined by the court.

        Section 7.    Term. Except as otherwise expressly provided herein, this
Agreement shall be effective upon the execution of this Agreement by all parties
thereto as of the date set forth above and will remain in effect through the
first anniversary of such date (the "Expiration Date"). For the avoidance of
doubt, the parties agree that the expiration of this Agreement on the Expiration
Date without a breach thereof by the Group or any Group Member shall not result
in the removal of the Nominee or any Replacement Director, as the case may be,
from the Board.

        Section 8.    Notices. All notices, consents, waivers and other
communications under this Agreement must be in writing (which shall include
telecopier communication) and will be deemed to have been duly given if
delivered by hand or by nationally recognized overnight delivery service
(receipt requested), mailed by registered or certified U.S. mail (return receipt
requested) postage prepaid or telecopied if confirmed immediately thereafter by
also mailing a copy of any notice, request or other communication by U.S. mail
as provided in this Section:

                  Group:               c/o Jeffrey L. Gendell
                                       237 Park Avenue, Suite 900
                                       New York, New York 10017
                                       Telephone:    (212) 692-3695
                                       Telecopy:     (212) 692-3698

                  with a copy to:      Schulte Roth & Zabel LLP
                                       919 Third Avenue
                                       New York, New York  10022
                                       Attention: Steven J. Fredman, Esq.
                                       Telephone:    (217) 756-2567
                                       Telecopy:     (217) 593-5955

                  Company:             Mr. Larry D. Huffman
                                       President and Chief Executive Officer
                                       Kankakee Bancorp, Inc.
                                       310 South Schuyler Avenue
                                       Kankakee, Illinois  60901-0003
                                       Telephone:    (815) 937-4440
                                       Telecopy:     (815) 937-3674

                  with a copy to:      John E. Freechack, Esq.
                                       Barack Ferrazzano Kirschbaum
                                       Perlman & Nagelberg LLC
                                       333 West Wacker Drive
                                       Suite 2700
                                       Chicago, Illinois  60606
                                       Telephone:    (312) 984-3100
                                       Telecopy:     (312) 984-3150

or to such other person or place as any party shall furnish to the other parties
hereto. Except as otherwise provided herein, all such notices, consents, waivers
and other communications shall be effective: (a) if delivered by hand,

                                       6

<PAGE>

when delivered; (b) if mailed in the manner provided in this Section, five
business days after deposit with the United States Postal Service; (c) if
delivered by overnight express delivery service, on the next Business Day after
deposit with such service; and (d) if by telecopier, on the next business day if
also confirmed by mail in the manner provided in this Section.

         Section 9.   Governing Law.  This Agreement shall be governed in all
respects, including validity, interpretation and effect, by the internal laws of
the State of Delaware, without regard to the principles of conflict of laws.

         Section 10.  Severability. If any term, provision, covenant or
restriction of this Agreement is held by any governmental authority or a court
of competent jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated.

         Section 11.  Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of and be enforceable by the successors and
assigns, and transferees by operation of law, of the parties. Except as
otherwise expressly provided for herein, this Agreement shall not inure to the
benefit of, be enforceable by or create any right or cause of action in any
person, including any stockholder of the Company, other than the parties hereto.

         Section 12.  Survival of Representations, Warranties and Agreements.
All representations, warranties, covenants and agreements made herein shall
survive the execution and delivery of this Agreement.

         Section 13.  Amendments.  This Agreement may not be modified, amended,
altered or supplemented except upon the execution and delivery of a written
agreement executed by all of the parties hereto or their respective successors
and assigns.

         Section 14.  Counterparts. This Agreement may be executed in
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same agreement.

         Section 15.  Duty to Execute.  Each party agrees to execute any and all
documents, and to do and perform any and all acts and things necessary or proper
to effectuate or further evidence the terms and provisions of this Agreement.

            [The remainder of this page is intentionally left blank.

                       Signatures are on following page.]

                                       7

<PAGE>

         IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the undersigned and duly authorized officers or representatives of the
undersigned as of the day and year first above written.

                                          Kankakee Bancorp, Inc.

                                          By: /s/ Larry D. Huffman
                                              ----------------------------------
                                              Name: Larry D. Huffman
                                              Title: President and Chief
                                                     Executive Officer

/s/ Jeffrey L. Gendell
--------------------------------------------
Jeffrey L. Gendell

Tontine Management, L.L.C.

By:  /s/ Jeffrey L. Gendell
     --------------------------------------
     Name: Jeffrey L. Gendell
     Title: Managing Member

Tontine Partners, L.P.
BY:  Tontine Management, L.L.C.

By:  /s/ Jeffrey L. Gendell
     --------------------------------------
     Name: Jeffrey L. Gendell
     Title: Managing Member

Tontine Financial Partners, L.P.
BY:  Tontine Management, L.L.C.

By:  /s/ Jeffrey L. Gendell
     --------------------------------------
     Name: Jeffrey L. Gendell
     Title: Managing Member

Tontine Overseas Associates, L.C.C.

By:  /s/ Jeffrey L. Gendell
     --------------------------------------
     Name: Jeffrey L. Gendell
     Title: Managing Member

                                        8

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