LSBK Lake Shore Bancorp Inc

Exhibit 2.1

AMENDED AND RESTATED PLAN OF CONVERSION AND REORGANIZATION

OF

LAKE SHORE, MHC

TABLE OF CONTENTS

(i)

PLAN OF CONVERSION AND REORGANIZATION

OF

LAKE SHORE, MHC

This Plan of Conversion and Reorganization (the “Plan”) provides for the conversion and reorganization of Lake Shore, MHC, a federally-chartered mutual holding company (the “Mutual Holding Company”), from the mutual to the capital stock form of organization (the “Conversion”). As of the date of this Plan, the Mutual Holding Company owns approximately 63.4% of the outstanding shares of common stock of Lake Shore Bancorp, Inc., a federally-chartered stock corporation (the “Mid-Tier Holding Company”), and the Mid-Tier Holding Company owns 100% of the outstanding shares of common stock of Lake Shore Savings Bank (the “Bank”), a federally-chartered savings bank. As part of the Conversion, (i) a new stock holding company (the “Holding Company”) will be established to succeed to all of the rights and obligations of the Mutual Holding Company and the Mid-Tier Holding Company, (ii) the Bank will complete the Charter Conversion, and (iii) the Holding Company will issue shares of Holding Company Common Stock in the Offering and the Exchange Offering. The Subscription Shares will be offered for sale in the Offering upon the terms and conditions set forth in this Plan. The subscription rights granted to Participants in the Subscription Offering are set forth in Sections 8 through 11 of this Plan. All sales of Subscription Shares in the Community Offering, in the Syndicated Community Offering or in the Firm Commitment Underwritten Offering, or in any other manner permitted by the Bank Regulators, will be at the sole discretion of the Boards of Directors of the Bank and the Holding Company. As part of the Conversion, each Minority Stockholder will receive Exchange Shares in exchange for its Minority Shares in the Exchange Offering. The Conversion will have no impact on depositors, borrowers or other customers of the Bank. After the Conversion, the Bank’s insured deposits will continue to be insured by the FDIC to the extent provided by applicable law. The purpose of the Conversion is to convert the Mutual Holding Company to the capital stock form of organization, which will provide the Bank and the Holding Company with additional capital to grow and respond to changing regulatory and market conditions. The Conversion will also provide the Bank and the Holding Company with greater flexibility to undertake corporate transactions, including mergers and acquisitions and branch expansions.

This Plan has been unanimously adopted by the Boards of Directors of the Mutual Holding Company, the Mid-Tier Holding Company and the Bank. This Plan also must be approved by at least: (i) a majority of the total votes eligible to be cast by Voting Members at the Members Meeting; (ii) two-thirds of the total votes eligible to be cast by Stockholders at the Stockholders Meeting; and (iii) a majority of the total votes eligible to be cast by Minority Stockholders at the Stockholders Meeting. Approval of this Plan by the Voting Members and by the Stockholders shall constitute approval of each of the constituent transactions necessary to implement this Plan, including the MHC Merger, the Mid-Tier Merger and the Charter Conversion. The Federal Reserve must approve this Plan before it is presented to Voting Members and Stockholders for their approval.

For the purposes of this Plan, the following terms have the following meanings:

Account Holder – Any Person holding a Deposit Account in the Bank.

Acting in Concert – The term Acting in Concert means: (i) knowing participation in a joint activity or interdependent conscious parallel action towards a common goal whether or not pursuant to an express agreement; or (ii) a combination or 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. A person or company which acts in concert with another person or company (“other party”) shall also be deemed to be acting in concert with any person or company who is also acting in concert with that other party, except that any Tax-Qualified Employee Stock Benefit Plan shall not be deemed to be acting in concert with its trustee or a person who serves in a similar capacity solely for the purpose of determining whether stock held by the trustee and stock held by the plan shall be aggregated.

Affiliate – Any Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with another Person.

Appraised Value Range – The range of the estimated consolidated pro forma market value of the Holding Company, which shall also be equal to the estimated pro forma market value of the total number of shares of Conversion Stock to be issued in the Conversion, as determined by the Independent Appraiser before the Subscription Offering and as it may be amended from time to time thereafter. The maximum and minimum of the Appraised Value Range may vary as much as 15% above and 15% below, respectively, the midpoint of the Appraised Value Range.

Articles of Combination – The Articles of Combination filed with the Federal Reserve, and any similar documents filed with the Bank Regulators, in connection with the consummation of any merger relating to the Conversion.

Articles of Merger – The Articles of Merger filed with the Maryland Department, and any similar documents filed in connection with the consummation of any merger relating to the Conversion.

Associate – The term Associate when used to indicate a relationship with any Person, means (i) any corporation or organization (other than the Mutual Holding Company, the Mid-Tier Holding Company, the Bank or a majority-owned subsidiary of the Mutual Holding Company, the Mid-Tier Holding Company or the Bank) if the person is a senior officer or partner or beneficially owns, directly or indirectly, 10% or more of any class of equity securities of the corporation or organization, (ii) any trust or other estate, if the person has a substantial beneficial interest in the trust or estate or is a trustee or fiduciary of the trust or estate except that for the purposes of this Plan relating to subscriptions in the Offering and the sale of Subscription Shares following the Conversion, a person who has a substantial beneficial interest in any Non-Tax-Qualified Employee Stock Benefit Plan or any Tax-Qualified Employee Stock Benefit Plan, or who is a trustee or fiduciary of such plan, is not an Associate of such plan, and except that, for

2

purposes of aggregating total shares that may be held by Officers and Directors, the term “Associate” does not include any Tax-Qualified Employee Stock Benefit Plan, and (iii) any person who is related by blood or marriage to such person and (A) who lives in the same home as such person or (B) who is a Director or Officer of the Mutual Holding Company, the Mid-Tier Holding Company, the Bank or the Holding Company, or any of their parents or subsidiaries.

Bank – Lake Shore Savings Bank, a federally-chartered savings bank.

Bank Liquidation Account – The account established by the Bank representing the liquidation interests received by Eligible Account Holders and Supplemental Eligible Account Holders in connection with the Conversion.

Bank Regulators – The Federal Reserve and other bank regulatory agencies, if any, responsible for reviewing and approving the Conversion, including the ownership of the Bank by the Holding Company and the MHC Merger and the Mid-Tier Merger.

Charter Conversion– The conversion of the charter of the Bank from a federal savings bank to a New York savings bank and then immediately thereafter to a New York commercial bank.

Code – The Internal Revenue Code of 1986, as amended.

Community Offering – A direct offering by the Holding Company of Subscription Shares not subscribed for in the Subscription Offering for sale to certain members of the general public. A Community Offering, if any, may occur concurrently with the Subscription Offering, any Syndicated Community Offering or both, or upon conclusion of the Subscription Offering.

Control – (including the terms “controlling,” “controlled by,” and “under common control with”) means the direct or indirect power to direct or exercise a controlling influence over the management or policies of a Person, whether through the ownership of voting securities, by contract or otherwise as described in 12 C.F.R. Part 238.

Conversion – The conversion and reorganization of the Mutual Holding Company to stock form pursuant to this Plan, and all steps incident or necessary thereto including the Offering and the Exchange Offering.

Conversion Stock – The Subscription Shares and the Exchange Shares.

Deposit Account – Any withdrawable account, including, without limitation, savings, time, demand, NOW accounts, money market, certificate and passbook accounts.

Director – A member of the Board of Directors of the Bank, the Mid-Tier Holding Company, the Holding Company or the Mutual Holding Company, as appropriate in the context.

Eligible Account Holder – Any Person holding a Qualifying Deposit as of the close of business on the Eligibility Record Date for purposes of determining subscription rights and establishing subaccount balances in the Liquidation Account and the Bank Liquidation Account.

3

Eligibility Record Date – The date for determining Eligible Account Holders of the Bank, which is December 31, 2023.

Employees – All Persons employed by the Bank, the Mid-Tier Holding Company, the Holding Company or the Mutual Holding Company.

Employee Plan – Any one or more Tax-Qualified Employee Stock Benefit Plans of the Bank or its subsidiaries or the Holding Company, including any ESOP and 401(k) Plan.

ESOP – The Bank’s Employee Stock Ownership Plan, and related trust.

Exchange Offering – The offering of Exchange Shares to Minority Stockholders in exchange for Minority Shares.

Exchange Ratio – The ratio at which a Minority Share is exchanged for an Exchange Share upon consummation of the Conversion. The Exchange Ratio (which shall be rounded to four decimal places) shall be determined such that as of the closing of the Conversion the ratio will result in the Minority Stockholders owning in the aggregate the same percentage of the outstanding shares of Holding Company Common Stock immediately upon completion of the Conversion as the percentage of Mid-Tier Holding Company common stock owned by the Minority Stockholders in the aggregate immediately before the consummation of the Conversion before giving effect to (a) cash in lieu of any fractional Exchange Shares and (b) any Subscription Shares purchased by Minority Stockholders in the Offering; provided that the Exchange Ratio will be adjusted to reflect assets held by the Mutual Holding Company (other than shares of stock of the Mid-Tier Holding Company).

Exchange Shares – The shares of Holding Company Common Stock issued to Minority Stockholders in the Exchange Offering.

FDIC – The Federal Deposit Insurance Corporation.

Federal Reserve – The Board of Governors of the Federal Reserve System and/or the Federal Reserve Bank of Philadelphia or New York, as indicated by the context.

Firm Commitment Underwritten Offering – The offering, at the sole discretion of the Holding Company, of Subscription Shares not subscribed for in the Subscription Offering and any Community Offering, to members of the general public through one or more underwriters. A Firm Commitment Underwritten Offering may occur following the Subscription Offering and any Community Offering.

Holding Company – The corporation formed under the laws of the State of Maryland, or the laws of another state of the United States, for the purpose of acquiring all of the shares of capital stock of the Bank in connection with the Conversion.

Holding Company Common Stock – The common stock, par value $0.01 per share, of the Holding Company. Shares of Holding Company Common Stock will be issued in the Offering and Exchange Offering.

4

Independent Appraiser – The appraiser retained by the Mutual Holding Company, Mid-Tier Holding Company and the Bank to prepare an appraisal of the pro forma market value of the Holding Company.

Liquidation Account – The account established by the Holding Company representing the liquidation interests received by Eligible Account Holders and Supplemental Eligible Account Holders in connection with the Conversion in exchange for their interests in the Mutual Holding Company immediately before the Conversion.

Local Community –Chautauqua, Erie and Cattaraugus Counties, New York.

Majority Ownership Interest – A fraction, the numerator of which is the number of shares of Mid-Tier Holding Company common stock owned by the Mutual Holding Company immediately before the completion of the Conversion, and the denominator of which is the total number of shares of Mid-Tier Holding Company common stock issued and outstanding immediately before the completion of the Conversion.

Maryland Department – The Maryland State Department of Assessments and Taxation.

Member – Any Person who qualifies as a member of the Mutual Holding Company pursuant to its charter.

Member Voting Record Date – The date fixed by the Directors for determining eligibility to vote at the Members Meeting.

Members Meeting – The special meeting of Voting Members, and any adjournments thereof, held to consider and vote upon this Plan, if required by the Bank Regulators.

MHC Merger – The merger of the Mutual Holding Company with and into the Mid-Tier Holding Company, with the Mid-Tier Holding Company as the surviving entity. The MHC Merger shall occur immediately before the completion of the Conversion, as set forth in this Plan.

Mid-Tier Holding Company – Lake Shore Bancorp, Inc., the federally-chartered corporation that owns 100% of the outstanding shares of common stock of the Bank, and any successor thereto.

Mid-Tier Merger – The merger of the Mid-Tier Holding Company with the Holding Company, with the Holding Company as the resulting entity. The Mid-Tier Merger shall occur immediately following the MHC Merger and before the completion of the Conversion, as set forth in this Plan.

Minority Shares – All outstanding shares of common stock of the Mid-Tier Holding Company, or shares of common stock of the Mid-Tier Holding Company issuable upon the exercise of options or grant of stock awards, owned by persons other than the Mutual Holding Company.

Minority Stockholder – Any owner of Minority Shares.

5

Mutual Holding Company – Lake Shore, MHC, the federally-chartered mutual holding company of the Mid-Tier Holding Company and the Bank and that owns approximately 63.4% of the outstanding shares of common stock of the Mid-Tier Holding Company.

NYSDFS – New York State Department of Financial Services

Offering – The offering and issuance, pursuant to this Plan, of shares of Holding Company Common Stock in a Subscription Offering, Community Offering and/or Syndicated Community Offering or Firm Commitment Underwritten Offering, as the case may be. The term “Offering” does not include the Exchange Offering.

Offering Range – The range of the number of Subscription Shares offered for sale in the Offering multiplied by the Subscription Price. The Offering Range shall be equal to the Appraised Value Range multiplied by the Majority Ownership Interest (as adjusted to reflect assets held by the Mutual Holding Company (other than shares of stock of the Mid-Tier Holding Company)). The maximum and minimum of the Offering Range may vary as much as 15% above and 15% below, respectively, the midpoint of the Offering Range.

Officer – The term Officer means the chairman of the board, president, vice president, treasurer, secretary, or comptroller of any company, or any other person who participates in its major policy decisions.

Order Form – Any form (together with any cover letter and acknowledgments) sent to any Participant or Person containing among other things a description of the alternatives available to such Person under this Plan and by which any such Person may make elections regarding subscriptions for Subscription Shares.

Other Member – Any Person holding a Deposit Account at the close of business on the Member Voting Record Date (other than an Eligible Account Holder or Supplemental Eligible Account Holder).

Participant – Any Eligible Account Holder, Employee Plan, Supplemental Eligible Account Holder or Other Member.

Person – An individual, a corporation, a partnership, an association, a joint-stock company, a limited liability company, a trust, an unincorporated organization, or a government or political subdivision of a government.

Plan – This Plan of Conversion and Reorganization of the Mutual Holding Company as it exists on the date hereof and as it may hereafter be amended in accordance with its terms.

Prospectus – The one or more documents used in offering the Conversion Stock.

Qualifying Deposit – The aggregate balance of all Deposit Accounts in the Bank of (i) an Eligible Account Holder at the close of business on the Eligibility Record Date, provided such aggregate balance is not less than $50.00, or (ii) a Supplemental Eligible Account Holder at the close of business on the Supplemental Eligibility Record Date, provided such aggregate balance is not less than $50.00.

6

Resident – Any Person who occupies a dwelling within the Local Community, has a present intent to remain within the Local Community for a period of time, and manifests the genuineness of that intent by establishing an ongoing physical presence within the Local Community together with an indication that such presence within the Local Community is something other than merely transitory. To the extent the Person is a corporation or other business entity, to be a Resident the principal place of business or headquarters of the corporation or business entity must be in the Local Community. To the extent a Person is a personal benefit plan, the circumstances of the beneficiary shall apply with respect to this definition. In the case of all other benefit plans, circumstances of the trustee shall be examined for purposes of this definition. The Mutual Holding Company and the Bank may utilize deposit or loan records or such other evidence provided to it to determine whether a Person is a resident. In all cases, however, such a determination shall be in the sole discretion of the Mutual Holding Company and the Bank. A Person must be a “Resident” for purposes of determining whether such person “resides” in the Local Community, as such term is used in this Plan.

SEC – The United States Securities and Exchange Commission.

Stockholder – Any owner of outstanding common stock of the Mid-Tier Holding Company, including the Mutual Holding Company.

Stockholder Voting Record Date – The date fixed by the Directors for determining eligibility to vote at the Stockholders Meeting.

Stockholders Meeting – The special, or annual, meeting of Stockholders, and any adjournments thereof, held to consider and vote upon this Plan.

Subscription Offering – The offering of Subscription Shares to Participants.

Subscription Price – The price per Subscription Share to be paid by Participants and others in the Offering. The Subscription Price shall be $10.00, unless otherwise determined by the Board of Directors of the Holding Company, and it will be fixed before the commencement of the Subscription Offering.

Subscription Shares – Shares of Holding Company Common Stock offered for sale in the Offering. Subscription Shares do not include Exchange Shares.

Supplemental Eligible Account Holder – Any Person (other than Directors and Officers of the Mutual Holding Company, the Bank and the Mid-Tier Holding Company and their Associates) holding a Qualifying Deposit at the close of business on the Supplemental Eligibility Record Date and who is not an Eligible Account Holder.

Supplemental Eligibility Record Date – The date for determining Supplemental Eligible Account Holders, which shall be the last day of the calendar quarter preceding Federal Reserve approval of the application for conversion. The Supplemental Eligibility Record Date will only occur if the Federal Reserve has not approved the Conversion within fifteen (15) months after the Eligibility Record Date.

7

Syndicated Community Offering – The offering, at the sole discretion of the Holding Company, of Subscription Shares not subscribed for in the Subscription Offering and the Community Offering, to members of the general public through a syndicate of broker-dealers. The Syndicated Community Offering may occur concurrently with the Subscription Offering and any Community Offering.

Tax-Qualified Employee Stock Benefit Plan – Any defined benefit plan or defined contribution plan, such as an employee stock ownership plan, stock bonus plan, profit-sharing plan or other plan, which, with its related trust, meets the requirements to be “qualified” under Code Section 401. A “Non-Tax-Qualified Employee Stock Benefit Plan” is any defined benefit plan or defined contribution plan which is not so qualified.

Voting Member – Any Member who at the close of business on the Member Voting Record Date is entitled to vote as a Member.

A. After adoption of this Plan by the Boards of Directors of the Bank, the Mid-Tier Holding Company and the Mutual Holding Company, this Plan, together with all other requisite material, shall be submitted to the Bank Regulators for approval. Notice of the adoption of this Plan by the Boards of Directors of the Bank, the Mutual Holding Company and the Mid-Tier Holding Company will be published in a newspaper having general circulation in each community in which an office of the Bank is located, and copies of this Plan will be made available at each office of the Bank for inspection by Members. The Mutual Holding Company will publish a notice of the filing with the Bank Regulators of an application to convert in accordance with the provisions of this Plan as well as notices required in connection with any holding company application, merger application or other application required to complete the Conversion. The Bank will also file an application to the NYSDFS in connection with the Charter Conversion.

B. Promptly following approval by the Bank Regulators, this Plan will be submitted to: (i) a vote of the Voting Members at the Members Meeting and (ii) a vote of the Stockholders at the Stockholders Meeting. The Mutual Holding Company will mail to all Voting Members, at their last known address appearing on the records of the Bank as of the Member Voting Record Date, a proxy statement in either long or summary form describing this Plan, which will be submitted to a vote of Voting Members at the Members Meeting. The Mid-Tier Holding Company will mail to all Stockholders as of the Stockholder Voting Record Date a proxy statement describing this Plan, which will be submitted to a vote of Stockholders at the Stockholders Meeting. The Holding Company also will mail to all Participants a Prospectus and Order Form for the purchase of Subscription Shares. In addition, all Participants will receive, or will be given the opportunity to request by either telephone or by letter addressed to the Bank’s Secretary, a copy of this Plan as well as the articles of incorporation and bylaws of the Holding Company. This Plan must be approved by at least: (i) a majority of the total votes eligible to be cast by Voting Members at the Members Meeting; (ii) two-thirds of the total votes eligible to be cast by Stockholders at the Stockholders Meeting; and (iii) a majority of the total votes eligible to be cast by Minority Stockholders at the Stockholders Meeting. Upon such approval of this Plan, the Mutual Holding Company, the Mid-Tier Holding Company, the Holding Company and the Bank will take all other necessary steps pursuant to applicable laws and regulations to consummate the Conversion and the Charter Conversion. The Conversion must be completed within twenty-four (24) months of the approval of this Plan by Voting Members.

8

C. The period for the Subscription Offering will be not less than twenty (20) days nor more than forty-five (45) days from the date Participants are first mailed a Prospectus and Order Form, unless extended. Any Subscription Shares for which subscriptions have not been received in the Subscription Offering may be issued in a Community Offering, and/or a Syndicated Community Offering or a Firm Commitment Underwritten Offering, or in any other manner permitted by the Bank Regulators. All sales of Subscription Shares must be completed within forty-five (45) days after the last day of the Subscription Offering unless the offering period is extended by the Mutual Holding Company and the Holding Company with the approval of the Bank Regulators.

D. The Conversion will be effected as follows, or in any other manner that is consistent with the purposes of this Plan and applicable laws and regulations. The choice of which method to effect the Conversion will be made by the Boards of Directors of the Mutual Holding Company, the Mid-Tier Holding Company and the Bank immediately before the closing of the Conversion. Each of the steps set forth below shall be deemed to occur in such order as is necessary to consummate the Conversion pursuant to this Plan, the intent of the Boards of Directors of the Mutual Holding Company, the Mid-Tier Holding Company and the Bank, and applicable federal and state regulations and policy. Approval of this Plan by Voting Members and Stockholders also shall constitute approval of each of the transactions necessary to implement this Plan.

9

E. As part of the Conversion, the Minority Shares outstanding immediately before the consummation of the Conversion shall automatically, without further action on the part of the holders thereof, be converted into and become the right to receive Exchange Shares based upon the Exchange Ratio. The basis for exchange of Minority Shares for Exchange Shares shall be fair and reasonable. Options to purchase shares of Mid-Tier Holding Company common stock that are outstanding immediately before the consummation of the Conversion shall be converted into options to purchase shares of Holding Company Common Stock, with the number of shares subject to the option and the exercise price per share to be adjusted based upon the Exchange Ratio so that the aggregate exercise price remains unchanged, and with the duration of the option remaining unchanged.

F. The Holding Company shall register the Conversion Stock with the SEC and any appropriate state securities authorities. In addition, the Mid-Tier Holding Company shall prepare preliminary proxy materials as well as other applications and information for review by the SEC in connection with the solicitation of Stockholder approval of this Plan.

G. All assets, rights, interests, privileges, powers, franchises and property (real, personal and mixed) of the Mid-Tier Holding Company and the Mutual Holding Company shall be automatically transferred to and vested in the Holding Company by virtue of the Conversion without any deed or other document of transfer. The Holding Company, without any order or action on the part of any court or otherwise and without any documents of assumption or assignment, shall hold and enjoy all of the properties, franchises and interests, including appointments, powers, designations, nominations and all other rights and interests as the agent or other fiduciary in the same manner and to the same extent as such rights, franchises, and interests and powers were held or enjoyed by the Mid-Tier Holding Company and the Mutual Holding Company. The Holding Company shall be responsible for all of the liabilities, restrictions and duties of every kind and description of the Mid-Tier Holding Company and the Mutual Holding Company immediately before the consummation of the Conversion, including liabilities for all debts, obligations and contracts of the Mid-Tier Holding Company and the Mutual Holding Company, matured or unmatured, whether accrued, absolute, contingent or otherwise and whether or not reflected or reserved against on balance sheets, books of accounts or records of the Mid-Tier Holding Company and the Mutual Holding Company.

H. The home office and branch offices of the Bank shall be unaffected by the Conversion. The executive offices of the Holding Company shall be located at the current executive offices of the Mutual Holding Company and Mid-Tier Holding Company.

10

The Boards of Directors of the Mutual Holding Company, the Mid-Tier Holding Company, the Holding Company and the Bank shall take all necessary steps to convert the Mutual Holding Company to stock form, form the Holding Company and complete the Charter Conversion and Offering. The Mutual Holding Company, Mid-Tier Holding Company, Bank and Holding Company shall make timely applications to the Bank Regulators and filings with the SEC and the NYSDFS for any requisite regulatory approvals to complete the Conversion and the Charter Conversion.

The Subscription Shares will be offered for sale in the Subscription Offering to the Participants in the respective priorities set forth in this Plan. The Subscription Offering may begin as early as the mailing of the proxy statement for the Members Meeting. The Holding Company Common Stock will not be insured by the FDIC. The Bank will not extend credit to any Person to purchase shares of Holding Company Common Stock.

Any Subscription Shares for which subscriptions have not been received in the Subscription Offering may be issued in the Community Offering, subject to the terms and conditions of this Plan. The Community Offering, if any, will involve an offering of unsubscribed Subscription Shares directly to the general public with a first preference given to natural persons and trusts of natural persons residing in the Local Community and a second preference given to Minority Stockholders as of the Stockholder Voting Record Date. The Community Offering may begin concurrently with, or at any time during or after the Subscription Offering. The offer and sale of Subscription Shares before the Members Meeting, however, is subject to the approval of this Plan by the Voting Members and by the Stockholders, including Minority Stockholders.

If feasible, any Subscription Shares remaining unsold after the Subscription Offering and any Community Offering may be offered for sale in a Syndicated Community Offering or a Firm Commitment Underwritten Offering, or in any manner approved by the Bank Regulators that will achieve a widespread distribution of the Subscription Shares. The issuance of Subscription Shares in the Subscription Offering and any Community Offering will be consummated simultaneously on the date the sale of Subscription Shares is consummated in any Syndicated Community Offering or Firm Commitment Underwritten Offering, and only if the required minimum number of Subscription Shares will be issued.

The total number of shares of Conversion Stock to be offered in the Conversion will be determined jointly by the Boards of Directors of the Mutual Holding Company, the Mid-Tier Holding Company and the Holding Company immediately before the commencement of the Subscription Offering, and will be based on the Appraised Value Range and the Subscription Price. The Offering Range will be equal to the Appraised Value Range multiplied by the Majority Ownership Interest (as adjusted to reflect assets held by the Mutual Holding Company (other than shares of stock of the Mid-Tier Holding Company)). The estimated pro forma

11

consolidated market value of the Holding Company will be subject to adjustment within the Appraised Value Range if necessitated by market or financial conditions, with the receipt of any required approvals of the Bank Regulators, and the maximum of the Appraised Value Range may be increased by up to 15% after the commencement of the Subscription Offering to reflect changes in market and financial conditions or demand for the shares. The number of shares of Conversion Stock issued in the Conversion will be equal to the estimated pro forma consolidated market value of the Holding Company, as may be amended, divided by the Subscription Price, and the number of Subscription Shares issued in the Offering will be equal to the product of (i) the estimated pro forma consolidated market value of the Holding Company, as may be amended, divided by the Subscription Price, and (ii) the Majority Ownership Interest (as adjusted to reflect assets held by the Mutual Holding Company (other than shares of stock of the Mid-Tier Holding Company)).

If the product of the Subscription Price multiplied by the number of shares of Conversion Stock to be issued in the Conversion is below the minimum of the Appraised Value Range, or materially above the maximum of the Appraised Value Range, a resolicitation of purchasers may be required, provided that up to a 15% increase above the maximum of the Appraised Value Range will not be deemed material so as to require a resolicitation. Any resolicitation shall be effected in such manner and within such time as the Mutual Holding Company, the Mid-Tier Holding Company and the Holding Company shall establish, if all required regulatory approvals are obtained.

Notwithstanding the foregoing, shares of Conversion Stock will not be issued unless, before the consummation of the Conversion, the Independent Appraiser confirms to the Bank, the Mutual Holding Company, the Holding Company, and the Bank Regulators, that, to the best knowledge of the Independent Appraiser, nothing of a material nature has occurred which, taking into account all relevant factors, would cause the Independent Appraiser to conclude that the number of shares of Conversion Stock issued in the Conversion multiplied by the Subscription Price is incompatible with its estimate of the aggregate consolidated pro forma market value of the Holding Company. If such confirmation is not received, the Holding Company may cancel the Offering and the Exchange Offering, extend the Offering and establish a new Subscription Price and/or Appraised Value Range, hold a new Offering and Exchange Offering after canceling the Offering and the Exchange Offering, or take such other action as the Bank Regulators may permit.

The Holding Company Common Stock to be issued in the Conversion shall be fully paid and nonassessable.

The Holding Company may retain up to 50% of the net proceeds of the Offering. The Holding Company believes that the Offering proceeds will provide economic strength to the Holding Company and the Bank for the future in a highly competitive and regulated financial services environment, and would support the growth in the operations of the Holding Company and the Bank through increased lending, acquisitions of financial service organizations, continued diversification into other related businesses and other business and investment activities, including the possible payment of dividends and possible repurchases of the Holding Company Common Stock as permitted by applicable state law and by applicable federal regulations and policy.

12

A. Each Eligible Account Holder shall have nontransferable subscription rights to subscribe for in the Subscription Offering up to the greater of 150,000 of the Subscription Shares issued in the Offering, 0.10% of the total number of Subscription Shares issued in the Offering, or fifteen times the product (rounded down to the next whole number) obtained by multiplying the number of Subscription Shares offered in the Offering by a fraction of which the numerator is the amount of the Eligible Account Holder’s Qualifying Deposit and the denominator is the total amount of Qualifying Deposits of all Eligible Account Holders, in each case on the Eligibility Record Date, subject to the purchase limitations specified in Section 14.

B. If Eligible Account Holders exercise subscription rights for a number of Subscription Shares in excess of the total number of such shares eligible for subscription, the Subscription Shares shall be allocated among the subscribing Eligible Account Holders so as to permit each subscribing Eligible Account Holder to purchase a number of shares sufficient to make his or her total allocation of Subscription Shares equal to the lesser of 100 shares or the number of shares for which such Eligible Account Holder has subscribed. Any remaining shares will be allocated among the subscribing Eligible Account Holders whose subscriptions remain unsatisfied in the proportion that the amount of the Qualifying Deposit of each Eligible Account Holder whose subscription remains unsatisfied bears to the total amount of the Qualifying Deposits of all Eligible Account Holders whose subscriptions remain unsatisfied. If the amount so allocated exceeds the amount subscribed for by any one or more Eligible Account Holders, the excess shall be reallocated (one or more times as necessary) among those Eligible Account Holders whose subscriptions are still not fully satisfied on the same principle until all available shares have been allocated.

C. Subscription rights as Eligible Account Holders received by Directors and Officers and their Associates that are based on deposits made by such persons during the twelve (12) months preceding the Eligibility Record Date shall be subordinated to the subscription rights of all other Eligible Account Holders, except as permitted by the Bank Regulators.

The Employee Plans shall have subscription rights to purchase in the aggregate up to 10% of the Subscription Shares issued in the Offering, including any Subscription Shares to be issued as a result of an increase in the maximum of the Offering Range after commencement of the Subscription Offering and before the completion of the Conversion. Consistent with applicable laws and regulations and practices and policies, the Employee Plans may use funds contributed by the Holding Company or the Bank and/or borrowed from an independent financial institution or from the Holding Company to exercise such subscription rights, and the Holding Company and the Bank may make scheduled discretionary contributions thereto, provided that such contributions do not cause the Holding Company or the Bank to fail to meet any applicable regulatory capital requirements. The Employee Plans shall not be deemed to be Associates or Affiliates of or Persons Acting in Concert with any Director or Officer of the Holding Company or the Bank. Alternatively, if permitted by the Bank Regulators, the Employee Plans may purchase all or a portion of such shares in the open market after the completion of the Conversion.

13

A. Each Supplemental Eligible Account Holder shall have nontransferable subscription rights to subscribe for in the Subscription Offering up to the greater of 150,000 of the Subscription Shares issued in the Offering, 0.10% of the total number of Subscription Shares issued in the Offering, or fifteen times the product (rounded down to the next whole number) obtained by multiplying the number of Subscription Shares offered in the Offering by a fraction of which the numerator is the amount of the Supplemental Eligible Account Holder’s Qualifying Deposit and the denominator is the total amount of Qualifying Deposits of all Supplemental Eligible Account Holders, in each case on the Supplemental Eligibility Record Date, subject to the availability of sufficient shares after filling in full all subscription orders of Eligible Account Holders and Employee Plans and subject to the purchase limitations specified in Section 14.

B. If Supplemental Eligible Account Holders exercise subscription rights for a number of Subscription Shares in excess of the total number of such shares eligible for subscription following subscriptions by Eligible Account Holders and Employee Plans, Subscription Shares shall be allocated among the subscribing Supplemental Eligible Account Holders so as to permit each subscribing Supplemental Eligible Account Holder, to the extent possible, to purchase a number of shares sufficient to make his or her total allocation of Subscription Shares equal to the lesser of one hundred (100) shares or the number of shares for which such Supplemental Eligible Account Holder has subscribed. Any remaining shares will be allocated among the subscribing Supplemental Eligible Account Holders whose subscriptions remain unsatisfied in the proportion that the amount of the Qualifying Deposit of such Supplemental Eligible Account Holder whose subscription remains unsatisfied bears to the total amount of the Qualifying Deposits of all Supplemental Eligible Account Holders whose subscriptions remain unsatisfied. If the amount so allocated exceeds the amount subscribed for by any one or more Supplemental Eligible Account Holders, the excess shall be reallocated (one or more times as necessary) among those Supplemental Eligible Account Holders whose subscriptions are still not fully satisfied on the same principle until all available shares have been allocated.

A. Each Other Member shall have nontransferable subscription rights to subscribe for in the Subscription Offering up to the greater of 150,000 of the Subscription Shares issued in the Offering or 0.10% of the total number of shares of Subscription Shares issued in the Offering, subject to the availability of sufficient shares after filling in full all subscription orders of Eligible Account Holders, Employee Plans and Supplemental Eligible Account Holders and subject to the purchase limitations specified in Section 14.

14

B. If Other Members exercise subscription rights for a number of Subscription Shares is in excess of the total number of such shares available for subscription following subscriptions by Eligible Account Holders, Employee Plans and Supplemental Eligible Account Holders, Subscription Shares will be allocated among Other Members so as to permit each such subscribing Other Member, to the extent possible, to purchase a number of shares sufficient to make his or her total allocation of Subscription Shares equal to the lesser of one hundred (100) shares or the number of shares for which each such Other Member has subscribed. Any remaining shares will be allocated among the subscribing Other Members whose subscriptions remain unsatisfied in the proportion that the amount of the subscription of each such Other Member bears to the total amount of the subscriptions of all Other Members whose subscriptions remain unsatisfied.

If subscriptions are not received for all Subscription Shares offered for sale in the Subscription Offering, shares for which subscriptions have not been received may be offered for sale in the Community Offering through a direct community marketing program which may use a broker, dealer, consultant or investment banking firm experienced and expert in the sale of savings institutions securities. Such entities may be compensated on a fixed fee basis or on a commission basis, or a combination thereof. If orders for Subscription Shares in the Community Offering exceed the number of shares available for sale, shares shall be allocated (to the extent shares remain available) first to cover orders of natural persons (including trusts of natural persons) residing in the Local Community, second to cover orders of Minority Stockholders as of the Stockholder Voting Record Date, and thereafter to cover orders of other members of the general public. If orders for Subscription Shares exceed the number of shares available for sale in a category pursuant to the purchase priorities described above, shares will be allocated within the category so that each member of that category will receive the lesser of one hundred (100) shares or the amount ordered, and thereafter remaining shares will be allocated on an equal number of shares basis per order. In connection with the allocation, orders received for Subscription Shares in the Community Offering will first be filled up to a maximum of two percent (2%) of the shares sold in the Offering, and thereafter any remaining shares will be allocated on an equal number of shares basis per order. The Mutual Holding Company and the Holding Company shall use their best efforts consistent with this Plan to distribute Subscription Shares sold in the Community Offering in such a manner as to promote the widest distribution practicable of such shares. The Holding Company reserves the right to reject any or all orders, in whole or in part, that are received in the Community Offering. Any Person may purchase up to 150,000 of the Subscription Shares in the Community Offering, subject to the purchase limitations specified in Section 14.

If feasible, the Board of Directors of the Holding Company may determine to offer Subscription Shares not sold in the Subscription Offering or the Community Offering, if any, for sale in a Syndicated Community Offering using a broker, dealer, consultant or investment banking firm experienced and expert in the sale of savings institutions securities. Such entities may be compensated on a fixed fee basis or on a commission basis, or a combination thereof.

15

The Syndicated Community Offering shall be subject to such terms, conditions and procedures as may be determined by the Mutual Holding Company and the Holding Company, in a manner that will achieve the widest distribution of Subscription Shares, subject to the right of the Holding Company to accept or reject in whole or in part any orders received in the Syndicated Community Offering. In the Syndicated Community Offering, any Person may purchase up to 150,000 of the Subscription Shares, subject to the purchase limitations specified in Section 14. In addition, unless otherwise approved or permitted by the Federal Reserve, orders received for Subscription Shares in the Syndicated Community Offering will first be filled up to a maximum of two percent (2%) of the shares sold in the Offering, and thereafter any remaining shares will be allocated on an equal number of shares basis per order. Provided that the Subscription Offering has begun, the Holding Company may begin the Syndicated Community Offering at any time. The Holding Company reserves the right to reject any or all orders, in whole or in part, that are received in the Syndicated Community Offering.

Alternatively, if feasible, the Board of Directors may determine to offer Subscription Shares not sold in the Subscription Offering or any Community Offering for sale in a Firm Commitment Underwritten Offering subject to such terms, conditions and procedures as may be determined by the Mutual Holding Company and the Holding Company, subject to the right of the Holding Company to accept or reject in whole or in part any orders in the Firm Commitment Underwritten Offering. In the Firm Commitment Underwritten Offering, any Person may purchase up to 150,000 of the Subscription Shares, subject to the purchase limitations specified in Section 14. In addition, unless otherwise approved or permitted by the Federal Reserve, orders received for Subscription Shares in the Firm Commitment Underwritten Offering will first be filled up to a maximum of two percent (2%) of the shares sold in the Offering, and thereafter any remaining shares will be allocated on an equal number of shares basis per order. Provided the Subscription Offering has begun, the Holding Company may begin the Firm Commitment Underwritten Offering at any time. The Holding Company reserves the right to reject any or all orders, in whole or in part, that are received in the Firm Commitment Underwritten Offering.

If, for any reason, a Syndicated Community Offering or Firm Commitment Underwritten Offering of Subscription Shares not sold in the Subscription Offering or any Community Offering cannot be effected, or if any insignificant residue of Subscription Shares is not sold in the Subscription Offering, Community Offering, or any Syndicated Community Offering or Firm Commitment Underwritten Offering, the Holding Company will use its best efforts to make other arrangements for the disposition of unsubscribed shares aggregating at least the minimum of the Offering Range. Such other purchase arrangements will be subject to receipt of any required approval of the Bank Regulators.

The following limitations shall apply to all purchases and issuances of shares of Conversion Stock:

A. The maximum number of Subscription Shares that may be subscribed for or purchased in all categories in the Offering by any Person or Participant, together with any Associate or group of Persons Acting in Concert, shall not exceed 150,000 of the Subscription Shares issued in the Offering, except that the Employee Plans may subscribe for up to 10% of the Subscription Shares issued in the Offering (including shares issued in the event of an increase in the maximum of the Offering Range of 15%).

16

B. The maximum number of shares of Holding Company Common Stock that may be issued to or purchased in all categories of the Offering by Officers and Directors and their Associates in the aggregate shall not exceed 25% of the shares of Conversion Stock.

C. The maximum number of Subscription Shares that may be subscribed for or purchased in all categories of the Offering by any Person or Participant together with purchases by any Associate or group of Persons Acting in Concert, combined with Exchange Shares received by any such Person or Participant together with any Associate or group of Persons Acting in Concert, shall not exceed 9.9% of the shares of Conversion Stock, except that this ownership limitation shall not apply to the Employee Plans. However, Minority Stockholders will not be required to sell any shares of Holding Company Common Stock or be limited from receiving any Exchange Shares or be required to divest themselves of any Exchange Shares as a result of this limitation.

D. A minimum of twenty-five (25) Subscription Shares must be purchased by each Person or Participant purchasing shares in the Offering to the extent those shares are available; provided, however, that if the product of the minimum number of Subscription Shares purchased multiplied the Subscription Price exceeds $500, then such minimum purchase requirement shall be reduced to such number of shares which when multiplied by the price per share shall not exceed $500, as determined by the Board.

E. If the number of shares of Holding Company Common Stock otherwise allocable pursuant to Sections 8 through 13, inclusive, to any Person or that Person’s Associates would be in excess of the maximum number of shares permitted as set forth above, the number of shares of Holding Company Common Stock allocated to each such person shall be reduced to the lowest limitation applicable to that Person, and then the number of shares allocated to each group consisting of a Person and that Person’s Associates shall be reduced so that the aggregate allocation to that Person and his or her Associates complies with the above limits.

Depending upon market or financial conditions, the Boards of Directors of the Holding Company and the Mutual Holding Company, with the receipt of any required approvals of the Bank Regulators and without further approval of Voting Members, may decrease or increase the purchase limitations in this Plan, provided that the maximum purchase limitations may not be increased to a percentage in excess of 5% of the shares issued in the Offering except as provided below. If the Mutual Holding Company and the Holding Company increase the maximum purchase limitations, the Mutual Holding Company and the Holding Company are only required to resolicit Participants who subscribed for the maximum purchase amount in the Subscription Offering and who indicated a desire to be resolicited on the Order Form and may, in the sole discretion of the Mutual Holding Company and the Holding Company, resolicit certain other large purchasers. In the event of such a resolicitation, the Mutual Holding Company and the Holding Company shall have the right, in their sole discretion, to require such persons to supply immediately available funds for the purchase of additional Subscription Shares. Such persons will be prohibited from paying with a personal check, but the Mutual Holding Company and the Holding Company may allow payment by wire transfer. If the maximum purchase limitation is

17

increased to 5% of the shares issued in the Offering, such limitation may be further increased to 9.99%, provided that orders for Subscription Shares exceeding 5% of the Subscription Shares issued in the Offering shall not exceed in the aggregate 10% of the total Subscription Shares issued in the Offering. Requests to purchase additional Subscription Shares, if the purchase limitation is so increased, will be determined by the Board of Directors of the Holding Company in its sole discretion.

In the event of an increase in the total number of shares offered in the Offering due to an increase in the maximum of the Offering Range of up to 15% (the “Adjusted Maximum”), the additional shares may be used to fill the Employee Plans’ orders before all other orders and then will be allocated in accordance with the priorities set forth in this Plan.

For purposes of this Section 14, (i) Directors, Officers and Employees of the Bank, the Mid-Tier Holding Company, the Mutual Holding Company and the Holding Company or any of their subsidiaries shall not be deemed to be Associates or a group affiliated with each other or otherwise Acting in Concert solely as a result of their capacities as such, (ii) shares purchased by Tax-Qualified Employee Stock Benefit Plans shall not be attributable to the individual trustees or beneficiaries of any such plan for purposes of determining compliance with the limitations set forth in paragraphs A. and B. of this Section 14, and (iii) shares purchased by a Tax-Qualified Employee Stock Benefit Plan pursuant to instructions of an individual in an account in such plan in which the individual has the right to direct the investment, including any plan of the Bank qualified under Section 401(k) of the Code shall be aggregated and included in that individual’s purchases and not attributed to the Tax-Qualified Employee Stock Benefit Plan.

Each Person purchasing Subscription Shares in the Offering shall be deemed to confirm that such purchase does not conflict with the above purchase limitations contained in this Plan.

All payments for Subscription Shares subscribed for in the Subscription Offering and Community Offering must be delivered in full to the Bank or Holding Company, together with a properly completed and executed Order Form, on or before the expiration date of the Offering; provided, however, that if the Employee Plans subscribe for shares in the Subscription Offering, such plans will not be required to pay for the shares at the time they subscribe but rather may pay for such shares subscribed for by such plans at the Subscription Price upon consummation of the Conversion. Subscription funds will be held in a segregated account at the Bank.

Except as set forth in Section 14.E., above, payment for Subscription Shares shall be made by personal check, money order or bank draft from the subscriber. Alternatively, subscribers in the Subscription and Community Offerings may pay for the shares for which they have subscribed by cash or by authorizing the Bank on the Order Form to make a withdrawal from the designated types of Deposit Accounts at the Bank in an amount equal to the aggregate Subscription Price of such shares. Such authorized withdrawal shall be without penalty as to premature withdrawal. If the authorized withdrawal is from a certificate account, and the remaining balance does not meet the applicable minimum balance requirement, the certificate shall be canceled at the time of withdrawal, without penalty, and the remaining balance will earn interest at the passbook rate. Funds for which a withdrawal is authorized will remain in the

18

subscriber’s Deposit Account but may not be used by the subscriber during the Offering. Thereafter, the withdrawal will be given effect only to the extent necessary to satisfy the subscription (to the extent it can be filled) at the Subscription Price per share. Interest will continue to be earned on any amounts authorized for withdrawal until such withdrawal is given effect. Interest on funds received by check, draft or money order or by cash will be paid by the Bank at not less than the passbook rate. Such interest will be paid from the date payment is processed by the Bank until consummation or termination of the Offering. If for any reason the Offering is not consummated, all payments made by subscribers in the Subscription and Community Offerings will be refunded to them, with interest. In case of amounts authorized for withdrawal from Deposit Accounts, refunds will be made by canceling the authorization for withdrawal. The Bank is prohibited by regulation from knowingly making any loans or granting any lines of credit for the purchase of Subscription Shares in the Offering.

As soon as practicable after the registration statement prepared by the Holding Company has been declared effective by the SEC and the stock offering materials have been approved by the Bank Regulators, Order Forms will be distributed to the Eligible Account Holders, Employee Plans, Supplemental Eligible Account Holders and Other Members at their last known addresses appearing on the records of the Bank for the purpose of subscribing for shares of Holding Company Common Stock in the Subscription Offering and will be made available for use by those Persons to whom a Prospectus is delivered. Each Order Form will be preceded or accompanied by a Prospectus describing the Mutual Holding Company, the Mid-Tier Holding Company, the Holding Company, the Bank, the Holding Company Common Stock and the Offering. Each Order Form will contain, among other things, the following:

A. A specified date by which all Order Forms must be received by the Holding Company, or its agent, which date shall be not less than twenty (20) days, nor more than forty-five (45) days, following the date on which the Order Forms are first mailed to Participants by the Mutual Holding Company or the Holding Company, and which date will constitute the termination of the Subscription Offering unless extended;

B. The Subscription Price for the Subscription Shares to be sold in the Offering;

C. A description of the minimum and maximum number of Subscription Shares which may be subscribed for pursuant to the exercise of subscription rights or otherwise purchased in the Subscription and Community Offerings;

D. Instructions as to how the recipient of the Order Form is to indicate thereon the number of Subscription Shares for which such Person elects to subscribe and the available alternative methods of payment therefor;

E. An acknowledgment that the recipient of the Order Form has received a final copy of the Prospectus before the execution of the Order Form;

19

F. A statement to the effect that all subscription rights are nontransferable, will be void at the end of the Subscription Offering, and can only be exercised by delivering to the Holding Company or its agent within the subscription period such properly completed and executed Order Form, together with payment in the full amount of the aggregate purchase price as specified in the Order Form for the Subscription Shares for which the recipient elects to subscribe in the Subscription Offering (or by authorizing on the Order Form that the Bank withdraw said amount from the subscriber’s Deposit Account(s) at the Bank); and

G. A statement to the effect that the executed Order Form, once received by the Mutual Holding Company or the Holding Company, may not be modified or amended by the subscriber without the consent of the Holding Company.

Notwithstanding the above, the Mutual Holding Company and the Holding Company reserve the right in their sole discretion to accept or reject orders received on photocopied or facsimiled order forms.

If Order Forms (a) are not delivered or are not timely delivered by the United States Postal Service, (b) are not received by the Holding Company or are received by the Holding Company or its agent after the expiration date specified thereon, (c) are defectively completed or executed, (d) are not accompanied by the full required payment for the Subscription Shares subscribed for (including cases in which deposit accounts from which withdrawals are authorized are insufficient to cover the amount of the required payment), or (e) are not mailed pursuant to a “no mail” order placed in effect by the Account Holder, the subscription rights of the Participant to whom such rights have been granted will lapse as though such Participant failed to return the completed Order Form within the time period specified thereon; provided, however, that the Holding Company may, but will not be required to, waive any immaterial irregularity on any Order Form or require the submission of corrected Order Forms or the remittance of full payment for subscribed shares by such date as the Holding Company may specify. The interpretation by the Holding Company of terms and conditions of this Plan and of the Order Forms will be final, subject to the authority of the Bank Regulators.

The Holding Company will make reasonable efforts to comply with the securities laws of all states in the United States in which Persons entitled to subscribe for Subscription Shares pursuant to this Plan reside. However, no such Person will be issued subscription rights or be permitted to purchase Subscription Shares in the Subscription Offering if such Person resides in a foreign country; or in a state of the United States with respect to which any of the following apply: (a) a small number of Persons otherwise eligible to subscribe for shares under this Plan reside in such state; (b) the issuance of subscription rights or the offer or sale of Subscription Shares to such Persons would require the Holding Company under the securities laws of such state, to register as a broker, dealer, salesman or agent or to register or otherwise qualify its securities for sale in such state; or (c) such registration or qualification would be impracticable for reasons of cost or otherwise.

20

The Holding Company shall establish a Liquidation Account at the time of the Conversion in an amount equal to the product of (i) the Majority Ownership Interest and (ii) the Mid-Tier Holding Company’s total stockholders’ equity as reflected in the latest statement of financial condition contained in the final Prospectus used in the Conversion, plus the value of the net assets of the Mutual Holding Company as reflected in the latest statement of financial condition of the Mutual Holding Company before the effective date of the Conversion (excluding its ownership of Mid-Tier Holding Company common stock). Following the Conversion, the Liquidation Account will be maintained for the benefit of the Eligible Account Holders and Supplemental Eligible Account Holders who continue to maintain their Deposit Accounts at the Bank. Each Eligible Account Holder and Supplemental Eligible Account Holder shall, with respect to his Deposit Account, hold a related inchoate interest in a portion of the Liquidation Account balance in relation to his Deposit Account balance at the Eligibility Record Date or Supplemental Eligibility Record Date, respectively, or to such balance as it may be subsequently reduced, as hereinafter provided. The Holding Company also shall cause the Bank to establish and maintain the Bank Liquidation Account for the benefit of Eligible Account Holders and Supplemental Eligible Account Holders who continue to maintain their Deposit Accounts at the Bank.

In the unlikely event of a complete liquidation of (i) the Bank or (ii) the Bank and the Holding Company (and only in such event) following all liquidation payments to creditors (including those to Account Holders to the extent of their Deposit Accounts), each Eligible Account Holder and Supplemental Eligible Account Holder shall be entitled to receive a liquidating distribution from the Liquidation Account, in the amount of the then adjusted subaccount balance for such Eligible Account Holder’s or Supplemental Eligible Account Holder’s Deposit Account, before any liquidation distribution may be made to any holders of the Holding Company’s capital stock. A merger, consolidation or similar combination with another depository institution or holding company thereof, in which the Holding Company and/or the Bank is not the surviving entity, shall not be deemed to be a complete liquidation for this purpose. In such transactions, the Liquidation Account shall be assumed by the surviving holding company or institution.

In the unlikely event of a complete liquidation of either (i) the Bank or (ii) the Bank and the Holding Company (and only in such event) following all liquidation payments to creditors of the Bank (including those to Account Holders to the extent of their Deposit Accounts), at a time when the Bank has a positive net worth and the Holding Company does not have sufficient assets (other than the stock of the Bank) at the time of liquidation to fund its obligations under the Liquidation Account, the Bank, with respect to the Bank Liquidation Account shall immediately pay directly to each Eligible Account Holder and Supplemental Eligible Account Holder an amount necessary to fund the Holding Company’s remaining obligations under the Liquidation Account before any liquidating distribution may be made to any holders of the Bank’s capital stock and without making such amount subject to the Holding Company’s creditors. Each Eligible Account Holder and Supplemental Eligible Account Holder shall be entitled to receive a distribution from the Bank Liquidation Account, in the amount of the then adjusted subaccount balance for its Deposit Account then held, before any distribution may be made to any holders of the Holding Company’s or Bank’s capital stock.

21

In the event of a complete liquidation of the Holding Company where the Bank is not also completely liquidating, or in the event of a sale or other disposition of the Holding Company apart from the Bank, each Eligible Account Holder and Supplemental Eligible Account Holder shall be treated as surrendering such Person’s rights to the Liquidation Account and receiving from the Holding Company an equivalent interest in the Bank Liquidation Account. Each such holder’s interest in the Bank Liquidation Account shall be subject to the same rights and terms as if the Bank Liquidation Account were the Liquidation Account (except that the Holding Company shall cease to exist).

The initial subaccount balance for a Deposit Account held by an Eligible Account Holder and Supplemental Eligible Account Holder shall be determined by multiplying the opening balance in the Liquidation Account by a fraction, the numerator of which is the amount of the Qualifying Deposits of such Eligible Account Holder or Supplemental Eligible Account Holder and the denominator of which is the total amount of all Qualifying Deposits of all Eligible Account Holders and Supplemental Eligible Account Holders. For Deposit Accounts in existence at both the Eligibility Record Date and the Supplemental Eligibility Record Date, separate initial subaccount balances shall be determined on the basis of the Qualifying Deposits in such Deposit Account on each such record date. Such initial subaccount balance shall not be increased, but shall be subject to downward adjustment as described below.

If, at the close of business on any fiscal year end closing date, commencing on or after the effective date of the Conversion, the deposit balance in the Deposit Account of an Eligible Account Holder or Supplemental Eligible Account Holder is less than the lesser of (i) the balance in the Deposit Account at the close of business on any other annual closing date after the Eligibility Record Date or Supplemental Eligibility Record Date, or (ii) the amount of the Qualifying Deposit in such Deposit Account as of the Eligibility Record Date or Supplemental Eligibility Record Date, then the subaccount balance for such Deposit Account shall be adjusted downward by reducing such subaccount balance in an amount proportionate to the reduction in such deposit balance. In the event of a downward adjustment, the subaccount balance shall not be subsequently increased, notwithstanding any subsequent increase in the deposit balance of the related Deposit Account. If any such Deposit Account is closed, the related subaccount shall be reduced to zero.

The creation and maintenance of the Liquidation Account and the Bank Liquidation Account shall not operate to restrict the use or application of any capital of the Holding Company or the Bank, except that neither the Holding Company nor the Bank shall declare or pay a cash dividend on, or repurchase any of, its capital stock if the effect thereof would cause its equity to be reduced below: (i) the amount required for the Liquidation Account or the Bank Liquidation Account, as applicable; or (ii) the regulatory capital requirements of the Holding Company (to the extent applicable) or the Bank. Neither the Holding Company nor the Bank shall be required to set aside funds in connection with its obligations hereunder relating to the Liquidation Account and the Bank Liquidation Account, respectively. Eligible Account Holders and Supplemental Eligible Account Holders do not retain any voting rights in either the Holding Company or the Bank based on their interests in the Liquidation Account or the Bank Liquidation Account.

22

The amount of the Bank Liquidation Account shall equal at all times the amount of the Liquidation Account, and the Bank Liquidation Account shall be reduced by the same amount and upon the same terms as any reduction in the Liquidation Account. In no event will any Eligible Account Holder or Supplemental Eligible Account Holder be entitled to a distribution that exceeds such holder’s subaccount balance in the Liquidation Account.

For the three (3)-year period following the completion of the Conversion, the Holding Company will not without prior Federal Reserve approval (i) sell or liquidate the Holding Company, or (ii) cause the Bank to be sold or liquidated. Upon the written request of the Federal Reserve the Holding Company shall, or upon the prior written approval of the Federal Reserve the Holding Company may, at any time after two (2) years from the completion of the Conversion, transfer the Liquidation Account to the Bank, at which time the Liquidation Account shall be assumed by the Bank and the interests of Eligible Account Holders and Supplemental Eligible Account Holders will be solely and exclusively established in the Bank Liquidation Account. In the event such transfer occurs, the Holding Company shall be deemed to have transferred the Liquidation Account to the Bank and such Liquidation Account shall be subsumed into the Bank Liquidation Account and shall not be subject in any manner or amount to the claims of the Holding Company’s creditors. Approval of this Plan by the Voting Members and Stockholders shall constitute approval of the transactions described herein.

Following consummation of the Conversion, the holders of the voting capital stock of the Holding Company shall have the exclusive voting rights with respect to the Holding Company.

A. All Subscription Shares purchased by Directors or Officers of the Mutual Holding Company, the Mid-Tier Holding Company, the Holding Company or the Bank in the Offering shall be subject to the restriction that, except as provided in this Section or as may be approved by the Bank Regulators, no interest in such shares may be sold or otherwise disposed of for value for a period of one (1) year following the date of purchase in the Offering.

B. The restriction on disposition of Subscription Shares set forth above in this Section shall not apply to any disposition of such shares following the death of the person to whom such shares were initially sold under the terms of this Plan.

C. With respect to all Subscription Shares subject to restrictions on resale or subsequent disposition, each of the following provisions shall apply:

23

For a period of three (3) years following the Conversion, no Officer, Director or their Associates shall purchase, without the prior written approval of the Bank Regulators, any outstanding shares of Holding Company Common Stock except from a broker-dealer registered with the SEC. This provision shall not apply to negotiated transactions involving more than 1% of the outstanding shares of Holding Company Common Stock, the exercise of any options pursuant to a stock option plan or purchases of Holding Company Common Stock made by or held by any Tax-Qualified Employee Stock Benefit Plan or Non-Tax-Qualified Employee Stock Benefit Plan of the Bank or the Holding Company (including the Employee Plans) which may be attributable to any Officer or Director. As used herein, the term “negotiated transaction” means a transaction in which the securities are offered and the terms and arrangements relating to any sale are arrived at through direct communications between the seller or any person acting on its behalf and the purchaser or his investment representative. The term “investment representative” shall mean a professional investment advisor acting as agent for the purchaser and independent of the seller and not acting on behalf of the seller in connection with the transaction.

Each person holding a Deposit Account at the Bank at the time of Conversion shall retain an identical Deposit Account at the Bank following Conversion in the same amount and subject to the same terms and conditions (except as to voting and liquidation rights) applicable to such Deposit Account in the Bank immediately before the completion of the Conversion.

For the time period required by applicable laws and regulations, the Holding Company will register the securities issued in connection with the Conversion pursuant to the Securities Exchange Act of 1934 and will not deregister such securities for a period of at least three (3) years thereafter, except that the requirement to maintain the registration of such securities for three (3) years may be fulfilled by any successor to the Holding Company. In addition, the Holding Company will use its best efforts to encourage and assist a market-maker to establish and maintain a market for the Conversion Stock and to list those securities on a national or regional securities exchange unless otherwise permitted by the Federal Reserve.

24

Consummation of the Conversion is expressly conditioned upon prior receipt by the Mutual Holding Company, the Mid-Tier Holding Company, the Holding Company and the Bank of either a ruling, an opinion of counsel or a letter of advice from their tax advisors regarding the federal and state income tax consequences of the Conversion to the Mutual Holding Company, the Mid-Tier Holding Company, the Holding Company, the Bank and the Account Holders and Voting Members receiving subscription rights in the Conversion.

A. The Holding Company and the Bank are authorized to adopt Tax-Qualified Employee Stock Benefit Plans in connection with the Conversion, including without limitation, an ESOP. Existing as well as any newly created Tax-Qualified Employee Stock Benefit Plans may purchase shares of Holding Company Common Stock in the Offering, to the extent permitted by the terms of such benefit plans and this Plan.

B. As a result of the Conversion, the Holding Company shall be deemed to have ratified and approved all employee stock benefit plans maintained by the Bank and the Mid-Tier Holding Company and shall have agreed to issue (and reserve for issuance) Holding Company Common Stock in lieu of common stock of the Mid-Tier Holding Company pursuant to the terms of such benefit plans. Upon consummation of the Conversion, the Mid-Tier Holding Company common stock held by such benefit plans shall be converted into Holding Company Common Stock based upon the Exchange Ratio. Also upon consummation of the Conversion, (i) all rights to purchase, sell or receive Mid-Tier Holding Company common stock and all rights to elect to make payment in Mid-Tier Holding Company common stock under any agreement between the Bank or the Mid-Tier Holding Company and any Director, Officer or Employee thereof or under any plan or program of the Bank or the Mid-Tier Holding Company, shall automatically, by operation of law, be converted into and shall become an identical right to purchase, sell or receive Holding Company Common Stock and an identical right to make payment in Holding Company Common Stock under any such agreement between the Bank or the Mid-Tier Holding Company and any Director, Officer or Employee thereof or under such plan or program of the Bank, and (ii) rights outstanding under all stock option plans shall be assumed by the Holding Company and thereafter shall be rights only for shares of Holding Company Common Stock, with each such right being for a number of shares of Holding Company Common Stock based upon the Exchange Ratio and the number of shares of Mid-Tier Holding Company common stock that were available thereunder immediately before the consummation of the Conversion, with the price adjusted to reflect the Exchange Ratio but with no change in any other term or condition of such right.

C. The Holding Company and the Bank are authorized to adopt stock option plans, restricted stock award plans and other Non-Tax-Qualified Employee Stock Benefit Plans, provided that such plans conform to any applicable regulations. The Holding Company and the Bank intend to implement a stock option plan and a restricted stock award plan no earlier than six months after completion of the Conversion. Stockholder approval of these plans will be required. If adopted within twelve (12) months following the completion of the Conversion, the stock option plan will reserve a number of shares equal to up to 10% of the shares sold in the Offering and the stock award plan will reserve a number of shares equal to up to 4% of the shares sold in the Offering for awards to employees and directors at no cost to the recipients (unless the Bank’s tangible capital is less than 10% upon completion of the Offering in which case the stock award plan will reserve a number of shares equal to up to 3% of the shares sold in

25

the Offering), subject to adjustment, if any, as may be required by Federal Reserve regulations or policy in effect to reflect stock options or restricted stock granted by the Mid-Tier Holding Company before the completion of the Conversion. (Stock option plans, restricted stock award plans, as well as Non-Tax-Qualified Employee Stock Benefit Plans, implemented more than one (1) year following the completion of the Conversion are not subject to the restrictions set forth in the preceding sentence.) Shares for such plans may be issued from authorized but unissued shares, treasury shares or repurchased shares.

D. The Holding Company and the Bank are authorized to enter into employment agreements and/or change in control agreements with their executive officers.

A. For a period of three (3) years from the date of consummation of the Conversion, no person shall directly or indirectly offer to acquire or acquire the beneficial ownership of more than 10% of any class of equity security of the Holding Company without the prior written consent of the Federal Reserve. Nothing in this Plan shall prohibit the Holding Company from taking actions permitted under 12 C.F.R. 239.63(f).

B. The Articles of Incorporation of the Holding Company may contain a provision stipulating that in no event shall any record owner of any outstanding shares of Holding Company Common Stock who beneficially owns in excess of 10% of such outstanding shares be entitled or permitted to vote any shares held in excess of 10% of the Holding Company’s outstanding shares. In addition, the Articles of Incorporation and Bylaws of the Holding Company may contain provisions that provide for, or prohibit, as the case may be, staggered terms of the directors, qualifications for directors, noncumulative voting for directors, limitations on the calling of special meetings, a fair price provision for certain business combinations and certain notice requirements.

C. For the purposes of this section:

26

A. The Holding Company shall comply with applicable regulations in the repurchase of any shares of its capital stock following consummation of the Conversion. The Holding Company shall not declare or pay a cash dividend on, or repurchase any of, its capital stock, if such dividend or repurchase would reduce its capital below the amount then required for the Liquidation Account.

B. The Bank shall not declare or pay a cash dividend on, or repurchase any of, its capital stock if the effect thereof would cause its regulatory capital to be reduced below its applicable regulatory capital requirements or below the amount then required for the Bank Liquidation Account.

By voting to approve this Plan, Voting Members and Stockholders shall be voting to adopt the Articles of Incorporation and Bylaws of the Holding Company.

The Effective Date of the Conversion shall be the date upon which the Articles of Combination shall be filed with the Federal Reserve and the Articles of Merger shall be filed with the Maryland Department. The Articles of Combination and the Articles of Merger shall be filed after all requisite regulatory, Voting Member and Stockholder approvals have been obtained, all applicable waiting periods have expired, and sufficient subscriptions and orders for Subscription Shares have been received. The closing of the sale of all shares of Holding Company Common Stock sold in the Offering and the Exchange Offering shall occur simultaneously on the effective date of the closing.

The Mutual Holding Company, the Mid-Tier Holding Company, the Bank and the Holding Company may retain and pay for the services of legal, financial and other advisors to assist in connection with any or all aspects of the Conversion, including the Offering, and such parties shall use their best efforts to assure that such expenses shall be reasonable.

If deemed necessary or desirable, this Plan may be substantively amended as a result of comments from the Bank Regulators or otherwise at any time before the meetings of Voting Members and Stockholders to vote on this Plan by the Board of Directors of the Mutual Holding Company, and at any time thereafter by the Board of Directors of the Mutual Holding Company with the concurrence of the Bank Regulators. Any amendment to this Plan made after approval by Voting Members and Stockholders with the approval of the Bank Regulators shall not necessitate further approval by Voting Members or Stockholders unless otherwise required by the Bank Regulators. The Board of Directors of the Mutual Holding Company may terminate this Plan at any time before the Members Meeting and Stockholders Meeting, and at any time thereafter with the concurrence of the Bank Regulators.

27

By adoption of this Plan, Voting Members and Stockholders authorize the Board of Directors of the Mutual Holding Company to amend or terminate this Plan under the circumstances set forth in this Section.

Consummation of the Conversion pursuant to this Plan is expressly conditioned upon the following:

A. Prior receipt by the Mutual Holding Company, the Mid-Tier Holding Company, the Holding Company and the Bank of rulings of the United States Internal Revenue Service and the state taxing authorities, or opinions of counsel or tax advisors as described in Section 25 hereof;

B. The issuance of the Subscription Shares offered in the Conversion;

C. The issuance of Exchange Shares;

D. The completion of the Charter Conversion; and

E. The completion of the Conversion within the time period specified in Section 3 of this Plan.

All interpretations of this Plan and application of its provisions to particular circumstances by a majority of the Board of Directors of the Mutual Holding Company shall be final, subject to the authority of the Bank Regulators.

Adopted: January 27, 2025, as amended on March 11, 2025

28

EXHIBIT A

FORM OF MERGER AGREEMENT BETWEEN

LAKE SHORE, MHC

AND

LAKE SHORE BANCORP, INC., A FEDERAL CORPORATION

MERGER AGREEMENT BETWEEN

LAKE SHORE, MHC

AND

LAKE SHORE BANCORP, INC. (A FEDERAL CORPORATION)

THIS MERGER AGREEMENT (the “MHC Merger Agreement”), dated as of ______________, 2025, is made by and between Lake Shore, MHC (the “Mutual Holding Company”) and Lake Shore Bancorp, Inc. (a federal corporation) (the “Mid-Tier Holding Company”). Capitalized terms have the respective meanings given them in the Plan of Conversion and Reorganization of Lake Shore, MHC (the “Plan”), unless otherwise defined herein.

RECITALS:

1. The Mutual Holding Company is a federally-chartered mutual holding company that owns approximately 63.4% of the outstanding common stock of the Mid-Tier Holding Company.

2. The Mid-Tier Holding Company is a federally-chartered corporation that owns 100% of the outstanding common stock of Lake Shore Savings Bank (the “Bank”).

3. At least two-thirds of the members of the boards of directors of the Mutual Holding Company and the Mid-Tier Holding Company have approved this MHC Merger Agreement whereby the Mutual Holding Company shall merge with the Mid-Tier Holding Company with the Mid-Tier Holding Company as the surviving or resulting corporation (the “MHC Merger”), and have authorized the execution and delivery thereof.

NOW, THEREFORE, in consideration of the premises and mutual agreements contained herein, the parties hereto have agreed as follows:

1. Merger. At and on the Effective Date of the MHC Merger, the Mutual Holding Company will merge with the Mid-Tier Holding Company with the Mid-Tier Holding Company as the resulting entity (“Resulting Corporation”) whereby the shares of Mid-Tier Holding Company common stock held by the Mutual Holding Company will be canceled and Members, who are deemed for these purposes to be owners of the Mutual Holding Company, will constructively receive liquidation interests in the Mid-Tier Holding Company in exchange for their ownership interests in the Mutual Holding Company.

2. Effective Date. The MHC Merger shall not be effective until and unless the Plan is approved by the Board of Governors of the Federal Reserve System (the “Federal Reserve”) after approval of this MHC Merger Agreement by at least: (i) two-thirds of the total votes eligible to be cast by the Stockholders; (ii) a majority of the total votes eligible to be cast by Minority Stockholders; and (iii) a majority of the votes eligible to be cast by Voting Members, and the Articles of Combination shall have been filed with the Federal Reserve with respect to the MHC Merger. Approval of the Plan by the Voting Members shall constitute approval of this MHC Merger Agreement by the Voting Members. Approval of the Plan by Stockholders, including the Minority Stockholders, shall constitute approval of this MHC Merger Agreement by the Stockholders.

3. Name. The name of the Resulting Corporation shall be Lake Shore Bancorp, Inc.

4. Offices. The main office of the Resulting Corporation shall be 128 E. 4th Street, Dunkirk, New York, 14048.

5. Directors and Officers. The directors and officers of the Mid-Tier Holding Company immediately before the Effective Date shall be the directors and officers of the Resulting Corporation after the Effective Date.

6. Rights and Duties of the Resulting Corporation. At the Effective Date, the Mutual Holding Company shall be merged with and into the Mid-Tier Holding Company with the Mid-Tier Holding Company as the Resulting Corporation. The business of the Resulting Corporation shall be that of a federally chartered corporation as provided in its Charter. All assets, rights, interests, privileges, powers, franchises and property (real, personal and mixed) of the Mid-Tier Holding Company and the Mutual Holding Company shall be transferred automatically to and vested in the Resulting Corporation by virtue of the MHC Merger without any deed or other document of transfer. The Resulting Corporation, without any order or action on the part of any court or otherwise and without any documents of assumption or assignment, shall hold and enjoy all of the properties, franchises and interests, including appointments, powers, designations, nominations and all other rights and interests as the agent or other fiduciary in the same manner and to the same extent as such rights, franchises, and interests and powers were held or enjoyed by the Mid-Tier Holding Company and the Mutual Holding Company. The Resulting Corporation shall be responsible for all of the liabilities, restrictions and duties of every kind and description of the Mid-Tier Holding Company and the Mutual Holding Company immediately before the consummation of the MHC Merger, including liabilities for all debts, obligations and contracts of the Mid-Tier Holding Company and the Mutual Holding Company, matured or unmatured, whether accrued, absolute, contingent or otherwise and whether or not reflected or reserved against on balance sheets, books of accounts or records of the Mid-Tier Holding Company or the Mutual Holding Company. The stockholders of the Mid-Tier Holding Company shall possess all voting rights with respect to the shares of stock of the Resulting Corporation. All rights of creditors and other obligees and all liens on property of the Mid-Tier Holding Company and the Mutual Holding Company shall be preserved and shall not be released or impaired.

7. Rights of Members and Stockholders. At the Effective Date, the shares of Mid-Tier Holding Company common stock held by the Mutual Holding Company will be canceled and Members will constructively receive liquidation interests in the Mid-Tier Holding Company in exchange for their ownership interests in the Mutual Holding Company. Minority Stockholders’ rights will remain unchanged.

8. Other Terms. All terms used in this MHC Merger Agreement shall, unless defined herein, have the meanings set forth in the Plan. The Plan is incorporated herein by this reference and made a part hereof to the extent necessary or appropriate to effect and consummate the terms of this MHC Merger Agreement and the Conversion.

A-2

[Signature page immediately follows]

A-3

IN WITNESS WHEREOF, the Mutual Holding Company and the Mid-Tier Holding Company have caused this MHC Merger Agreement to be executed as of the date first above written.

A-4

EXHIBIT B

FORM OF MERGER AGREEMENT BETWEEN

LAKE SHORE BANCORP, INC. (A FEDERAL CORPORATION)

AND

LAKE SHORE BANCORP, INC. (A MARYLAND CORPORATION)

MERGER AGREEMENT BETWEEN

LAKE SHORE BANCORP, INC. (A FEDERAL CORPORATION)AND

LAKE SHORE BANCORP, INC. (A MARYLAND CORPORATION)

THIS MERGER AGREEMENT (the “Mid-Tier Merger Agreement”), dated as of ______________, 2025, is made by and between Lake Shore Bancorp, Inc. (a Federal corporation) (the “Mid-Tier Holding Company”) and Lake Shore Bancorp, Inc. (a Maryland corporation) (the “Holding Company”). Capitalized terms have the respective meanings given them in the Plan of Conversion and Reorganization of Lake Shore, MHC (the “Plan”), unless otherwise defined herein.

RECITALS:

1. The Mid-Tier Holding Company is a federally-chartered corporation that owns 100% of the outstanding common stock of Lake Shore Savings Bank (the “Bank”).

2. The Holding Company is a Maryland-chartered corporation that has been organized to succeed to the operations of the Mid-Tier Holding Company.

3. At least two-thirds of the members of the boards of directors of the Mid-Tier Holding Company and the Holding Company have approved this Mid-Tier Merger Agreement whereby the Mid-Tier Holding Company will merged with the Holding Company, with the Holding Company as the resulting corporation (the “Mid-Tier Merger”), and authorized the execution and delivery thereof.

NOW, THEREFORE, in consideration of the premises and mutual agreements contained herein, the parties hereto have agreed as follows:

1. Merger. At and on the Effective Date of the Mid-Tier Merger, the Mid-Tier Holding Company will merge with and into the Holding Company, with the Holding Company as the resulting corporation (the “Resulting Corporation”), whereby the Bank will become the wholly-owned subsidiary of the Holding Company. As part of the Mid-Tier Merger, the Members who constructively received liquidation interests in the Mid-Tier Holding Company will exchange the liquidation interests in the Mid-Tier Holding Company that they constructively received in the MHC Merger for interests in the Liquidation Account, and Minority Stockholders immediately before the consummation of the Conversion will exchange their Minority Shares for Exchange Shares in the Exchange Offering pursuant to the Exchange Ratio.

2. Effective Date. The Mid-Tier Merger shall not be effective until and unless the Plan is approved by the Board of Governors of the Federal Reserve System (the “Federal Reserve”) after approval by at least: (i) two-thirds of the votes eligible to be cast by Stockholders; (ii) a majority of the votes eligible to be cast by Minority Stockholders; and (iii) a majority of the votes eligible to be cast by Voting Members, and the Articles of Combination shall have been filed with the Federal Reserve with respect to the Mid-Tier Merger and Articles of Merger have been filed with the Maryland Department with respect to the Mid-Tier Merger. Approval of the Plan by the Stockholders, including the Minority Stockholders, shall constitute approval of this Mid-Tier Merger Agreement by such stockholders.

3. Name. The name of the Resulting Corporation shall be Lake Shore Bancorp, Inc.

4. Offices. The main office of the Resulting Corporation shall be 128 E. 4th Street, Dunkirk, New York, 14048.

5. Directors and Officers. The directors and officers of the Mid-Tier Holding Company immediately before the Effective Date shall be the directors and officers of the Resulting Corporation after the Effective Date.

6. Rights and Duties of the Resulting Corporation. At the Effective Date, the Mid-Tier Holding Company shall merge with the Holding Company, with the Holding Company as the Resulting Corporation. The business of the Resulting Corporation shall be that of a Maryland corporation as provided in its Articles of Incorporation. All assets, rights, interests, privileges, powers, franchises and property (real, personal and mixed) of the Mid-Tier Holding Company and the Holding Company shall be transferred automatically to and vested in the Resulting Corporation by virtue of the Mid-Tier Merger without any deed or other document of transfer. The Resulting Corporation, without any order or action on the part of any court or otherwise and without any documents of assumption or assignment, shall hold and enjoy all of the properties, franchises and interests, including appointments, powers, designations, nominations and all other rights and interests as the agent or other fiduciary in the same manner and to the same extent as such rights, franchises, and interests and powers were held or enjoyed by the Mid-Tier Holding Company and the Holding Company. The Resulting Corporation shall be responsible for all of the liabilities, restrictions and duties of every kind and description of the Mid-Tier Holding Company and the Holding Company immediately before the consummation of the Mid-Tier Merger, including liabilities for all debts, obligations and contracts of the Mid-Tier Holding Company and the Holding Company, matured or unmatured, whether accrued, absolute, contingent or otherwise and whether or not reflected or reserved against on balance sheets, books of accounts or records of the Mid-Tier Holding Company or the Holding Company. The stockholders of the Holding Company shall possess all voting rights with respect to the shares of stock of the Resulting Corporation. All rights of creditors and other obligees and all liens on property of the Mid-Tier Holding Company and the Holding Company shall be preserved and shall not be released or impaired.

7. Rights of Members and Stockholders. At the Effective Date, the Members immediately before the consummation of the Conversion will exchange the liquidation rights in the Mid-Tier Holding Company that they constructively received in the MHC Merger for interests in the Liquidation Account and the Minority Stockholders immediately before the consummation of the Conversion will exchange their Minority Shares for Exchange Shares in the Exchange Offering pursuant to the Exchange Ratio. All shares of Mid-Tier Holding Company Common Stock held in the treasury and each share of Mid-Tier Holding Company Common Stock owned by the Holding Company, or any direct or indirect wholly owned subsidiary of the Holding Company or of the Mid-Tier Holding Company immediately before the Effective Date (other than shares held in a fiduciary capacity or in connection with debts previously contracted) shall, at the Effective Date, cease to exist, and the Certificates for such shares shall be canceled as promptly as practicable thereafter, and no payment or distribution shall be made in consideration therefor.

B-2

8. Other Terms. All terms used in this Mid-Tier Merger Agreement shall, unless defined herein, have the meanings set forth in the Plan. The Plan is incorporated herein by this reference and made a part hereof to the extent necessary or appropriate to effect and consummate the terms of this Mid-Tier Merger Agreement and the Conversion.

[Signature page immediately follows]

B-3

IN WITNESS WHEREOF, the Mid-Tier Holding Company and the Holding Company have caused this Mid-Tier Merger Agreement to be executed as of the date first above written.

B-4

Exhibit 10.1

LAKE SHORE SAVINGS BANK

EMPLOYMENT AGREEMENT

This Employment Agreement (the “Agreement”) is made and entered into, effective as of the 11th day of March, 2025 (the “Effective Date”), by and between Lake Shore Savings Bank, a federally-chartered savings bank having its principal place of business at 128 East 4th Street, Dunkirk, New York 14048 (the “Bank”), and Taylor M. Gilden, a resident of the State of New York (the “Executive”). Any reference to the “Company” shall mean Lake Shore Bancorp, Inc., the parent corporation of the Bank.

WITNESSETH THAT:

WHEREAS, Executive is currently serving as Chief Financial Officer and Treasurer of the Bank and the Company; and

WHEREAS, the Bank desires to continue to employ the Executive, and the Executive desires to continue to remain employed by the Bank, subject to the terms and conditions set forth in this Agreement; and

WHEREAS, the Bank and Executive have read and understand the terms and provisions set forth in this Agreement and have been afforded a reasonable opportunity to review this Agreement with their respective legal counsel.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, and upon the terms and conditions hereinafter provided, the parties hereby agree as follows:

1. Employment and Employment Period. The Bank hereby employs the Executive and the Executive agrees to be employed by the Bank, on the terms and conditions set forth in this Agreement, for a period commencing on the date hereof and continuing until December 16, 2027 (the “Term”). Commencing on December 16, 2025, and on each anniversary thereafter (each, a “Renewal Date”), the Term shall extend automatically for one additional year, so that the Term shall be three-years from such Renewal Date; provided, however, that in order for this Agreement to renew, the outside non-employee members of the Board of Directors of the Bank (the “Board”) must take the following actions within the time frames set forth below prior to each Renewal Date: (i) at least ninety (90) days prior to the Renewal Date, review the CEO’s comprehensive performance evaluation and review of Executive for purposes of determining whether to extend this Agreement; and (ii) affirmatively approve the renewal or non-renewal of this Agreement, which decision shall be included in the minutes of the Board’s meeting. If the decision of the outside non-employee members of the Board is not to renew this Agreement, then the Board shall provide Executive with a written notice of non-renewal (the “Non-Renewal Notice”) at least sixty (60) days prior to any Renewal Date, such that this Agreement shall terminate at the end of twenty-four (24) months following such Renewal Date. The failure of the outside non-employee members of the Board to take the actions set forth herein before any Renewal Date will result in the automatic non-renewal of this Agreement, even if the Board fails to affirmatively issue the Non-Renewal Notice to Executive. If the Board fails to inform Executive of its determination regarding the renewal or non-renewal of this Agreement, the Executive may request, in writing, the results of the Board’s action (or non-action) and the Board shall, within ten (10) days of the receipt of such request, provide a written response to Executive. Reference herein to the term of this Agreement shall refer to both such initial term and such extended terms. Notwithstanding the foregoing, in the event a Change in Control (as defined below) occurs during the initial Term or the extended Term, the Term shall be extended automatically so that it is scheduled to expire no less than thirty-six (36) months beyond the effective date of the Change in Control, subject to extension as set forth above.

2. Capacity and Extent of Service.

(a) At all times during the Term of this Agreement, the Bank shall employ the Executive as its Chief Financial Officer and Treasurer.

(b) The Executive shall be employed on a full-time basis as Chief Financial Officer and Treasurer of the Bank and shall be assigned only such duties and tasks as are appropriate for a person in such position. The Executive shall be subject to the direction and supervision of the President and Chief Executive Officer of the Company and Bank.

(c) During his employment hereunder, the Executive shall devote his full business time and his best efforts, business judgment, skill and knowledge to the performance of his duties and responsibilities hereunder. Except as otherwise permitted in this Section 2(c) and Section 2(d), the Executive shall not engage in any other business activity during the Term, other than an activity approved in writing by the Board. For the avoidance of doubt, the Executive may engage in civic or charitable services or activities (“Community Activities”) during normal business hours without the need for prior notice to the Board; provided that such services or activities do not involve a material time commitment. The Executive shall promptly disclose any such Community Activities to the Board and shall cease any such Community Activities if directed in writing by the Board; provided that the Board determines in good faith that continuation of such Community Activities is contrary to the best interests of the Bank, taking into account the Bank’s reputation in the markets served by the Bank.

(d) With the prior written approval of the Board, the Executive may serve on boards of both for-profit and not-for-profit entities or engage in Community Activities that involve a material time commitment. Notwithstanding the foregoing, the Executive may continue to serve on any board of directors on which he was serving at the Effective Date. A list of such boards of directors has been supplied to the Board.

3. Compensation and Benefits.

(a) Base Compensation. As compensation for the services to be performed by the Executive during the Term, the Bank shall pay to the Executive, in regular periodic installments, an annual base salary (“Base Salary”) at the rate of Two Hundred Sixty-Five Thousand Dollars ($265,000) per year. Such Base Salary will be payable in accordance with the customary payroll practices of the Bank. During the term of this Agreement, the Board may consider increasing, but not decreasing (other than a decrease which is applicable to all named executive officers of the Bank and in a percentage not in excess of the percentage decrease for other named executive officers), Executive’s Base Salary as the Board deems appropriate. Any change in Base Salary will become the “Base Salary” for purposes of this Agreement.

(b) Short-Term Incentive Compensation. In addition to the foregoing Base Salary, the Executive shall be eligible during the Term to receive cash short-term incentive compensation of up to 35% of his Base Salary if the Bank achieves certain performance criteria established by the Board each year and set forth in a written cash incentive plan approved by the Board or the Compensation Committee of the Board. The plan will contain tiered incentive targets if certain performance criteria are achieved at four levels: threshold (90% of goal met), target (100% of goal met), maximum (110% of goal met), or superior (120% of goal met), which if the Executive achieves these levels, the annual incentive payments would be 10%, 20%, 35% and 45% of his Base Salary, respectively. Any such incentive compensation earned shall be payable in cash in the year following the year in which the compensation is earned in accordance with the Bank’s normal practices for the payment of short-term incentive compensation.

2

(c) Long-Term Incentive Compensation. In addition to the foregoing Base Salary, the Executive shall be eligible during the Term to receive long-term incentive compensation determined and payable in the discretion of the Compensation Committee of the Board, specifically including participation in the Bank’s ESOP and other equity incentive plans. At least annually, the Compensation Committee shall consider awarding long-term incentive compensation to the Executive.

(d) Other Benefits. During the Term, the Bank shall provide the Executive with other benefits in which the Executive was participating on the Effective Date. The Executive shall also be entitled to participate in any employee benefit plans from time to time in effect for executive officers of the Bank. The Executive shall be entitled to vacation pursuant to the Bank’s written policies, including the Bank’s Paid-Time Off Policy, as determined by the Board from time to time, which shall not be less than four weeks per year.

(e) Timing of Certain Payments. Any compensation payable or provided under this Section 3 shall be paid or provided not later than two and one-half months after the calendar year in which such compensation is no longer subject to a substantial risk of forfeiture, within the meaning of Treasury Regulations Section 1.409A-l(d).

4. Business Expenses. The Bank shall reimburse the Executive for all reasonable travel, cell phone and other business expenses incurred by him in the performance of his duties and responsibilities, including but not limited to, annual dues and/or membership fees in clubs and professional associations, and attendance at industry seminars and educational conferences. Such payments or reimbursements shall be subject to such reasonable requirements with respect to substantiation and documentation as may be specified by the Bank or its auditors. Reimbursements of expenses and in-kind benefits subject to this Section 4 or otherwise provided to the Executive shall be subject to the following rules: (i) the amount of such expenses eligible for reimbursement or in-kind benefits provided in any taxable year shall not affect the expenses eligible for reimbursement or in-kind benefits provided in any other taxable year, except as otherwise allowed by Section 409A of the Internal Revenue Code (“Code”); (ii) any reimbursement shall be made as soon as practicable but not later than on or before the last day of the calendar year in which the expenses were incurred; and (iii) no right to reimbursement or in-kind benefits may be liquidated or exchanged for another benefit.

5. Termination. Notwithstanding the provisions of Section 1, the Executive’s employment hereunder shall terminate under the following circumstances:

(a) Death. In the event of the Executive’s death during his employment under this Agreement, the Executive’s employment shall terminate on the date of his death. Upon termination of the Executive based due to his death, no amounts or benefits shall be due the Executive’s estate under this Agreement, provided that the Executive’s estate shall be entitled to benefits under any retirement plan of the Bank or the Company and other plans to which the Executive is a party.

(b) Disability. In the event the Executive becomes disabled during his employment under this Agreement, the Executive’s employment hereunder shall terminate. For purposes of this Agreement, disability means any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months and that renders the Executive unable to engage in any substantial gainful activity. Such determination may be made by the Board with objective medical input from a physician chosen by the Board. In the event of such termination, the Executive shall continue to receive his full Base Salary and benefits under Section 3(d) of this Agreement until he becomes eligible for and receives disability income under the long-term disability insurance coverage then in effect for the Executive.

3

(c) Termination by the Executive Without Good Reason. Notwithstanding the provisions of Section 1, the Executive may resign from the Bank at any time upon thirty (30) days’ prior written notice to the Bank. In the event of resignation by the Executive under this Section 5(c), the Board may elect to waive the period of notice, or any portion thereof.

(d) Termination by the Bank Without Cause. The Executive’s employment under this Agreement may be terminated by the Bank without Cause upon thirty (30) days’ prior written notice to the Executive.

(e) Termination by the Executive for Good Reason. The Executive may terminate his employment hereunder for Good Reason. For purposes of this Agreement, “Good Reason” shall mean that the Executive has complied with the “Good Reason Process” (hereinafter defined) following the occurrence of any of the following events:

(i) Failure of the Bank to continue the Executive in the positions of Chief Financial Officer and Treasurer (other than a change in position to which the Executive consents) during the Term;

(ii) Material adverse change by the Bank, not consented to by the Executive, in the nature or scope of the Executive’s responsibilities, title, authorities, powers, functions or duties from the responsibilities, title, authorities, powers, functions or duties normally exercised by an executive in the positions of Chief Financial Officer and Treasurer of the Bank;

(iii) An involuntary reduction in the Executive’s Base Salary except across-the-board salary reductions based on the Bank’s deteriorating financial performance similarly affecting substantially all executive management employees;

(iv) The involuntary relocation of the office at which the Executive is principally employed to a location more than twenty-five (25) miles’ driving distance from such office as of the Effective Date hereof (unless the relocated office is closer to the Executive’s then principal residence); or

(v) Material breach by the Bank of Section 3 hereof or of any other provision of this Agreement, which breach continues for more than ten (10) days following written notice given by the Executive to the Bank, such written notice to set forth in reasonable detail the nature of such breach.

“Good Reason Process” shall mean that (i) the Executive reasonably determines in good faith that a “Good Reason” condition has occurred; (ii) the Executive notifies the Bank in writing of the first occurrence of the Good Reason condition within sixty (60) days of the first occurrence of such condition; (iii) the Executive cooperates in good faith with the Bank’s efforts, for a period not less than thirty (30) days following such notice (the “Cure Period”), to remedy the condition; (iv) notwithstanding such efforts, the Good Reason condition continues to exist; and (v) the Executive terminates his employment within sixty (60) days after the end of the Cure Period. If the Bank cures the Good Reason condition during the Cure Period, Good Reason shall be deemed not to have occurred. Notwithstanding the foregoing, the Bank may elect to waive the Cure Period, in which case, the Executive’s termination may occur within such 30-day period.

4

(f) Termination by the Bank for Cause. At any time during the Term, the Bank may terminate the Executive’s employment hereunder for Cause if at a meeting of the Board called and held for such purpose (after notice to the Executive and an opportunity for him to be heard before the Board, which notice shall specify the basis for a proposal to terminate the Executive’s employment for “Cause”) a majority of Board determines in good faith that the Executive is guilty of conduct that constitutes “Cause” as defined herein. Only the following shall constitute “Cause” for such termination:

(i) personal dishonesty;

(ii) willful misconduct;

(iii) breach of fiduciary duty involving personal profit;

(iv) intentional and material failure to perform stated duties;

(v) willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order; or

(vi) material breach by Executive of any provision of this Agreement.

provided, however, that any purported termination of this Agreement by Bank shall be presumed to be other than for Cause unless Bank first provides a written notice to Executive that includes a copy of a resolution duly adopted by the Board at a meeting of the Board called and held for the purpose of considering such termination and that finds Cause to exist and specifies the particulars of such conduct.

(g) Termination due to Retirement. Upon termination of the Executive based on Retirement, no amounts or benefits shall be due the Executive under this Agreement, and the Executive shall be entitled to all benefits under any retirement plan of the Bank and other plans to which the Executive is a party. Termination of the Executive’s employment based on “Retirement” shall mean termination of the Executive’s employment in accordance with a retirement policy established by the Board or if no retirement policy exists, termination of Executive’s employment for any reason after Executive attains age 65.

6. Compensation Upon Termination.

(a) Termination Generally. If the Executive’s employment with the Bank is terminated for any reason, the Bank shall pay or provide to the Executive (or to his authorized representative or estate) (i) on or before the time required by law but in no event more than thirty (30) days after the Executive’s date of termination (the “Termination Date”), the sum of (A) any Base Salary earned through the Termination Date, (B) unpaid expense reimbursements (subject to, and in accordance with, Section 4 of this Agreement), (C) unused vacation that accrued through the Termination Date, and (D) any earned but unpaid short-term and long-term incentive compensation for the year immediately preceding the year of termination; and (ii) any vested benefits the Executive may have under any employee benefit plan of the Bank through the Termination Date, which vested benefits shall be paid and/or provided in accordance with the terms of such employee benefit plans (collectively, the “Accrued Benefits”).

(b) Termination by the Bank Without Cause or by the Executive for Good Reason. During the Term, if the Executive’s employment is terminated by the Bank without Cause as provided in Section 5(d), or the Executive terminates his employment for Good Reason as provided in Section 5(e), the Bank shall pay to the Executive his Accrued Benefits. In addition, subject to the last paragraph of this Section 6(b) and to compliance with the tax-related provisions in Section 8, the Bank shall provide the benefits listed in sub-sections 6(b)(i) to (ii) below (the “Severance Benefits”) to the Executive:

5

(i) Severance Payments. The Bank shall pay the Executive a severance payment in an amount equal to the sum of: (A) the Executive’s Base Salary plus (B) the average annual incentive cash compensation awarded to the Executive, pursuant to Section 3(b), with respect to the three (3) most recent fiscal years ending before the year of termination (the “Severance Amount”). The Severance Amount shall be paid to the Executive in a single lump sum cash payment within thirty (30) days of the Termination Date, subject to the receipt of the signed release within such thirty (30) day period (unless the Executive’s termination occurs under circumstances requiring the Executive to execute a release of claims within forty-five (45) days of termination, in which case the thirty (30) day period shall be extended to sixty (60) days); and further subject to the delay specified in Section 8(a) hereof, solely to the extent necessary to avoid penalties under Section 409A of the Code in the event the Executive is a specified employee (as defined therein); provided, however, that if the 30-day (or 60-day) period begins in one calendar year and ends in a second calendar year, the payment of the Severance Amount shall commence in the second calendar year.

(ii) Other Post-Termination Benefits. In the event of any termination without Cause of the Executive’s employment under Section 5(d), above, or any termination for Good Reason by the Executive of his own employment under Section 5(e), above, the Bank shall pay an additional cash lump sum payment to the Executive equal to the Bank’s applicable percentage of such cost (i.e., the Bank’s co-payment percentage) that would have been payable for a period of twelve (12) months on behalf of Executive (and, to the extent eligible under the terms of the applicable plans, the Executive’s family members), for continuing life, medical and dental coverage, based on the costs in effect for the Executive on the Termination Date. To the extent that the Executive and/or his family members elect COBRA continuation coverage for any period after the Executive’s termination, such cost will be paid by the Executive. Such amount shall be paid to the Executive within the thirty (30) day period (or sixty (60) day period, as applicable) following the Termination Date, provided however, if, at the Termination Date, the Executive is a specified employee as defined in Section 8(a) hereof, then, solely to the extent required to avoid taxes and penalties under Section 409A of the Code, such payment shall be made within the first thirty (30) days after the first day of the seventh calendar month commencing after such Termination Date.

The Bank may condition the provision of the Severance Benefits payable under Sections 6 or 7 of this Agreement on the Executive signing a Release Agreement in the form provided by the Bank (the “Release Agreement”) within twenty-one (21) days (or forty-five (45) days in certain conditions, in accordance with applicable law) after it is tendered and not revoking the Release Agreement within the seven (7) day revocation period set forth in the Release Agreement; provided that the Bank tenders the Release Agreement to the Executive no later than the Termination Date. Notwithstanding the foregoing, the Release Agreement may be modified to the extent necessary based on changes in applicable law from and after the date of this Agreement.

7. Change in Control Payment. The provisions of this Section 7 set forth the rights and obligations of Executive and the Bank upon the occurrence of a Change in Control of the Bank. These provisions are intended to assure and encourage in advance the Executive’s continued attention and dedication to his assigned duties and his objectivity during the pendency and after the occurrence of any such event. These provisions shall apply in lieu of, and expressly supersede, the provisions of Section 6(b) regarding severance pay and benefits upon a termination of employment, if such termination of employment occurs within three (3) months before or twelve (12) months after the occurrence of the first event constituting a Change in Control. These provisions shall terminate and be of no further force or effect beginning twelve (12) months after the occurrence of a Change in Control.

6

(a) Change in Control. During the Term, if within three (3) months before or twelve (12) months after a Change in Control, the Executive’s employment is terminated by the Bank without Cause as provided in Section 5(d) or the Executive terminates his employment for Good Reason as provided in Section 5(e), the Bank shall pay the Executive his Accrued Benefits. In addition, subject to compliance with the tax-related provisions in Section 8, the Executive shall be entitled to the following:

(i) The Bank shall pay to the Executive a Change in Control severance payment (“Change in Control Severance Payment”) in an amount equal to three (3) times the sum of (A) the Executive’s current Base Salary (or the Executive’s Base Salary in effect immediately prior to the Change in Control, if higher), plus (B) the average annual incentive cash compensation earned by the Executive pursuant to Section 3(b) with respect to the three (3) most recent fiscal years ending before the year of the Change in Control. The Change in Control Severance Payment shall be paid out in a lump sum payment no later than five (5) business days after the Termination Date, subject to Section 8(a) hereof, solely to the extent required to avoid penalties under Section 409A of the Code;

(ii) The Bank shall pay an additional cash lump sum payment to the Executive equal to the cost of providing for a period of thirty-six (36) months, at no expense to the Executive (and, to the extent eligible under the terms of the applicable plans, the Executive’s family members), continuing life, medical and dental coverage to the Executive and, as applicable, his family members, based on the aggregate cost of such coverage in effect for the Executive on the Termination Date. Such payment shall be made at the same time as the payment under Section 7(a)(i) above. To the extent that the Executive and/or his family members elect COBRA continuation coverage for any period after the Executive’s termination, such cost will be paid by the Executive.

(b) Change in Control. For purposes of this Agreement, the term “Change in Control” shall mean the consummation by the Company or the Bank, in a single transaction or series of related transactions, of any of the following:

(i) Merger: The Company or the Bank merges into or consolidates with another entity, or merges another bank or corporation into the Bank or the Company, and as a result, less than a majority of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of the Company or the Bank immediately before the merger or consolidation;

(ii) Acquisition of Significant Share Ownership: There is filed, or is required to be filed, a report on Schedule 13D or another form or schedule (other than Schedule 13G) required under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner of 25% or more of a class of the Company’s or the Bank’s voting securities; provided, however, this clause (ii) shall not apply to beneficial ownership of the Company’s or the Bank’s voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns 50% or more of its outstanding voting securities;

(iii) Change in Board Composition: During any period of two consecutive years, individuals who constitute the Company’s or the Bank’s board of directors at the beginning of the two-year period cease for any reason to constitute at least a majority of the Company’s or the Bank’s board of directors; provided, however, that for purposes of this clause (iii), each director who is first elected by the board (or first nominated by the board for election by the stockholders) by a vote of at least two-thirds (2/3) of the directors who were directors at the beginning of the two-year period or who is appointed to the board as the result of a directive, supervisory agreement or order issued by the primary regulator of the Company or the Bank or by the Federal Deposit Insurance Corporation (“FDIC”) shall be deemed to have also been a director at the beginning of such period; or

7

(iv) Sale of Assets: The Company or the Bank sells to a third party all or substantially all of its assets.

Notwithstanding anything in this Agreement to the contrary, in no event shall a reorganization of Lake Shore, MHC, the Company or Bank solely within its corporate structure, including a second-step conversion from mutual to stock form of Lake Shore, MHC, constitute a “Change in Control” for purposes of this Agreement.

8. Code Sections 409A and 280G.

(a) Anything in this Agreement to the contrary notwithstanding, if at the time of the Executive’s “Separation from Service” (as defined below), the Bank determines that the Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Executive becomes entitled to under this Agreement on account of the Executive’s Separation from Service would be considered deferred compensation subject to the 20 percent additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and such benefit shall not be provided until the date that is the earlier of (A) six months and one day after the Executive’s Separation from Service, or (B) the Executive’s death. If any such delayed cash payment is otherwise payable on an installment basis, the first payment shall include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for the application of this provision, and the balance of the installments shall be payable in accordance with their original schedule. Any such delayed cash payment shall earn interest at an annual rate equal to the applicable federal short-term rate published by the Internal Revenue Service for the month in which the date of Separation from Service occurs, from such date of Separation from Service until the payment date.

(b) To the extent that any payment or benefit described in this Agreement constitutes “non-qualified deferred compensation” under Section 409A of the Code, and to the extent that such payment or benefit is payable upon the Executive’s termination of employment, then such payments or benefits shall be payable only upon the Executive’s Separation from Service.” For purposes of this Agreement, a “Separation from Service” shall have occurred if the Bank and the Executive reasonably anticipate that either no further services will be performed by the Executive after the date of termination (whether as an employee or as an independent contractor) or the level of further services performed is less than fifty (50) percent of the average level of bona fide services in the thirty-six (36) months immediately preceding the termination. For all purposes hereunder, the definition of Separation from Service shall be interpreted consistent with Treasury Regulation Section 1.409A-1(h).

(c) The parties intend that this Agreement will be administered in accordance with Section 409A of the Code. To the extent that any provision of this Agreement is ambiguous as to its compliance with Section 409A of the Code, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A of the Code. The parties agree that this Agreement may be amended, as reasonably requested by either party, and as may be necessary to fully comply with Section 409A of the Code and all related rules and regulations in order to preserve the payments and benefits provided hereunder without additional cost to either party.

8

(d) The parties intend that the severance payments and other compensation provided for herein are reasonable compensation for Executive’s services to the Bank and shall not constitute “excess parachute payments” within the meaning of Section 280G (or any successor provision) of the Code. If the Bank’s independent accounting firm or independent tax counsel appointed by the Bank (“Tax Counsel”) determines that any or the aggregate value (as determined pursuant to Section 280G of the Code) of all payments, distributions, accelerations of vesting, awards and provisions of benefits by the Bank to or for the benefit of the Executive (whether paid or payable, distributed or distributable, accelerated, awarded or provided pursuant to the terms of this Agreement or otherwise), (a “Payment”) would constitute an excess parachute payment and be subject to the excise tax imposed by Section 4999 (or any successor provision) of the Code (the “Excise Tax”), then the Bank shall pay the Executive an additional payment (a “Gross-Up Payment”) such that after payment by Executive of all taxes (including any interest or penalties imposed with respect to such taxes, including any Excise Tax imposed upon the Gross-Up Payment), Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payment. The intent of the parties is that the Bank shall be solely responsible for, and shall pay, any Excise Tax on the Payments and Gross-Up Payment and any income and employment taxes (including, without limitation, penalties and interest) imposed on any Gross-Up Payment payable hereunder. For purposes of determining the amount of the Gross-Up Payment, the Executive shall be deemed to pay federal income tax and employment taxes at the highest marginal rate of federal income and employment taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of the Executive’s domicile for income tax purposes on the date the Gross-Up Payment is made.

(e) For purposes of this Agreement, the terms “excess parachute payment” and “parachute payments” shall have the meanings assigned to them in Section 280G (or any successor provision) of the Code and such “parachute payments” shall be valued as provided therein. Present value for purposes of this Agreement shall be calculated in accordance with Section 1274(b)(2) (or any successor provision) of the Code. All calculations and determinations under this Section 8 shall be made by Tax Counsel whose determinations shall be conclusive and binding on the Bank and the Executive for all purposes. Subject to the terms and conditions of this paragraph, for purposes of making the calculations and determinations required by this Section 8, Tax Counsel may rely on reasonable, good faith assumptions and approximations concerning the application of Section 280G (or any successor provision) and Section 4999 (or any successor provision) of the Code. The Bank and the Executive shall furnish Tax Counsel with such information and documents as Tax Counsel may reasonably request in order to make its determinations under this Section. The Bank shall bear all costs Tax Counsel may reasonably incur in connection with its services. In connection with making determinations under this Section, Tax Counsel shall take into account the value of any reasonable compensation for services to be rendered by the Executive before or after the Change in Control, including without limitation, the Executive’s agreement to refrain from performing services pursuant to a covenant not to compete or similar covenant, and the Bank shall cooperate in good faith in connection with any such valuations and reasonable compensation positions.

9. Non-Competition, Non-Solicitation and Confidential Information.

(a) Non-Competition. Upon any termination of the Executive’s employment for which the Executive receives a severance payment pursuant to Section 6(b) of this Agreement, the Executive agrees not to compete with the Bank for a period of one year following such termination in any city, town or county in which the Executive’s normal business office is located and the Bank or the Company has an office or have filed an application for regulatory approval to establish an office, determined as of the Termination Date. The Executive agrees that during such period and within said cities, towns and counties, the Executive shall not work for or advise, consult or otherwise serve with, directly or indirectly, any entity whose business materially competes with the depository, lending or other business activities of the Bank or its affiliates. The parties hereto, recognizing that irreparable injury will result to the Bank in

9

the event of the Executive’s breach of this Section 9(a), agree that in the event of any such breach by the Executive, the Bank will be entitled, in addition to any other remedies and damages available, to an injunction to restrain the violation hereof by the Executive, the Executive’s partners, agents, servants, employees and all persons acting for or under the direction of the Executive. The Executive represents and admits that, in the event of the termination of his employment pursuant to Section 6(b) of this Agreement, the Executive’s experience and capabilities are such that the Executive can obtain employment in a business engaged in other lines and/or of a different nature than the Bank, and that the enforcement of a remedy by way of injunction will not prevent the Executive from earning a livelihood. Nothing herein will be construed as prohibiting the Bank from pursuing any other remedies available to the Bank for such breach or threatened breach, including the recovery of damages from the Executive.

(b) Non-Solicitation. During the term of the Executive’s employment under this Agreement and one year following the Termination Date (other than a termination under Section 7 hereof), the Executive shall not, directly or indirectly (i) hire or attempt to hire any employee of the Bank, assist in such hiring by any other person, or encourage any such employee to terminate his or her relationship with the Bank, or (ii) solicit business from any customer of the Bank or their subsidiaries, divert or attempt to divert any business from the Bank or their subsidiaries, or induce, attempt to induce, or assist others in inducing or attempting to induce any agent, customer or supplier of the Bank or any other person or entity associated or doing business with the Bank (or proposing to become associated or to do business with the Bank) to terminate such person’s or entity’s relationship with the Bank (or to refrain from becoming associated with or doing business with the Bank) or in any other manner to interfere with the relationship between the Bank and any such person or entity. The Executive understands that the restrictions set forth in this Section 9(b) and the following Section 9(c) are intended to protect the Bank’ interests in its Confidential Information (as defined below) and established employee, customer and supplier relationships and goodwill, and the Executive agrees that such restrictions are reasonable and appropriate for this purpose. For the avoidance of doubt, the Executive’s involvement in general advertising or general personnel recruiting efforts that are not targeted at customers or employees of any of the Bank shall not be considered to violate this Section 9(b).

(c) Confidential Information. The Executive shall not at any time divulge, use, furnish, disclose or make accessible to anyone, other than to an employee or director of the Bank with a reasonable need to know, any knowledge or information with respect to confidential or secret data, procedures or techniques of the Bank, including confidential supervisory information (as defined in 12 CFR §4.32) (“Confidential Information”), provided, however, that nothing in this Section 9 shall prevent the disclosure by the Executive of any such information which at any time comes into the public domain other than as a result of the violation of the terms of this Section 9 by the Executive or which is otherwise lawfully acquired by the Executive. Execution of this Agreement by the Executive shall constitute his written agreement per 12 CFR §4.37 that he will treat the confidential supervisory information in accordance with 12 CFR §4.37.

(d) Documents, Records, etc. All documents, records, data, apparatus, equipment and other physical property, whether or not pertaining to Confidential Information, which are furnished to the Executive by the Bank or are produced by the Executive in connection with the Executive’s employment will be and remain the sole property of the Bank. The Executive will return to the Bank all such materials and property as and when requested by the Bank. In any event, the Executive will return all such materials and property immediately upon termination of the Executive’s employment for any reason. The Executive will not retain any such material or property or any copies thereof after such termination.

10

(e) Third-Party Agreements and Rights. The Executive hereby confirms that the Executive is not bound by the terms of any agreement with any previous employer or other party which restricts in any way the Executive’s use or disclosure of information or the Executive’s engagement in any business. The Executive represents to the Bank that the Executive’s execution of this Agreement, the Executive’s employment with the Bank and the performance of the Executive’s proposed duties for the Bank will not violate any obligations the Executive may have to any such previous employer or other party. In the Executive’s work for the Bank, the Executive will not disclose or make use of any information in violation of any agreements with or rights of any such previous employer or other party, and the Executive will not bring to the premises of the Bank any copies or other tangible embodiments of non-public information belonging to or obtained from any such previous employment or other party.

(f) Litigation and Regulatory Cooperation. During and after the Executive’s employment with the Bank, the Executive shall cooperate fully with the Bank in the defense or prosecution of any claims or any actions now in existence or that may be brought in the future against or on behalf of the Bank that relate to events or occurrences that transpired while the Executive was employed by the Bank; provided that after the end of the Executive’s employment, the Executive shall not be required to perform more than one hundred (100) hours of services pursuant to this Section 9(f) above and beyond services that could be compelled by issuance of a subpoena. The Executive’s full cooperation in connection with such claims or actions shall include, but not be limited to, being available to meet with counsel to prepare for discovery or trial and to act as a witness on behalf of the Bank at mutually convenient times. During and after the Executive’s employment, the Executive also shall cooperate fully with the Bank in connection with any investigation or review by any federal, state or local regulatory authority as such investigation or review relates to events or occurrences that transpired while the Executive was employed by the Bank. The Bank shall reimburse the Executive for any reasonable out-of-pocket expenses incurred in connection with the Executive’s performance of his obligations pursuant to this Section 9(f). Unless the Executive is then employed by the Bank, the Bank shall pay the Executive for any services pursuant to this Section 9(f) at the hourly rate of the Executive’s final annual Base Salary divided by 2,080; provided that no payment obligation shall apply to services that could be compelled pursuant to a subpoena.

(g) Injunction. The Executive agrees that it would be difficult to measure any damages caused to the Bank that might result from any breach by the Executive of the promises set forth in this Section 9, and that in any event money damages would be an inadequate remedy for any such breach. Accordingly, the Executive agrees that if the Executive breaches or proposes to breach, any portion of this Section 9, the Bank shall be entitled, in addition to all other remedies that it may have, to an injunction or other appropriate equitable relief to restrain any such breach without showing or proving any actual damages to the Bank.

10. Withholding. All payments made by the Bank under this Agreement shall be net of any tax or other amounts required to be withheld by the Bank under applicable law.

11. Indemnification. The Bank agrees to indemnify the Executive in his capacity as an officer of the Bank to the maximum extent permitted under Federal law; provided, however, the Bank shall not be required to indemnify or reimburse Executive for legal expenses or liabilities incurred in connection with an action, suit or proceeding arising from any illegal or fraudulent act committed by Executive. In addition, to the extent that the Executive serves at the request of the Bank as a representative, an officer or a Board member of any community organization or financial services industry association or similar entity, he shall be entitled to indemnification by the Bank. Indemnification pursuant to this Section 11 shall be subject to and administered in accordance with the charter or by-laws of the Bank, as amended from time to time; provided, however, that the terms of such indemnification shall be no less favorable to the Executive than those set forth in the charter or by-laws of the Bank as of the date of this Agreement. Any indemnification with respect to service to a third party shall be provided only to the extent that no indemnification or insurance is available from such third party or that any such indemnification or insurance has been exhausted. The provisions of this Section 11 shall survive expiration or termination of this Agreement for any reason whatsoever.

11

12. Notices. Any notices, requests, demands and other communications provided for by this Agreement shall be sufficient if in writing and delivered in person or sent by registered or certified mail, postage paid, to the Executive at the last address the Executive has filed in writing with the Bank or, in the case of the Bank, at its main office, attention of the Chairman of the Board.

13. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to its subject matter and may not be changed except by a writing duly executed and delivered by the Bank and the Executive in the same manner as this Agreement.

14. Binding Effect, Non-assignability. This Agreement shall be binding upon and inure to the benefit of the Bank and its successors. Neither this Agreement nor any rights arising hereunder may be assigned or pledged by the Executive during his lifetime. This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.

15. Amendment. This Agreement may be amended or modified only by a written instrument signed by the Executive and by a duly authorized representative of the Bank.

16. Enforceability. If any portion or provision of this Agreement shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction, then the remainder of this Agreement, or the application of such portion or provision in circumstances other than those as to which it is so declared illegal or unenforceable, shall not be affected thereby, and each portion and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

17. Forfeiture of Payments. The Executive agrees that the receipt of severance compensation under Section 6(b) is conditioned upon the Executive’s compliance in all material respects with the covenants set forth in Section 9. The foregoing shall be in addition to any other remedies or rights the Bank may have at law or in equity as a result of the Executive’s failure to observe such provisions.

18. Applicable Law. This Agreement shall be construed and enforced in all respects in accordance with the laws of the State of New York, without regard to its principles of conflicts of laws, and in accordance with and subject to any applicable federal laws to which the Bank may be subject as an FDIC insured institution.

19. Required Provisions.

(a) If Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank’s affairs by a notice served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C.§1818(e)(3) or (g)(1); the Bank’s obligations under this contract shall be suspended as of the date of service, unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Bank may in its discretion: (i) pay Executive all or part of the compensation withheld while their contract obligations were suspended; and (ii) reinstate (in whole or in part) any of the obligations which were suspended.

(b) If Executive is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issued under Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(4) or (g)(1), all obligations of the Bank under this contract shall terminate as of the effective date of the order, but vested rights of the contracting parties shall not be affected.

12

(c) If the Bank is in default as defined in Section 3(x)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1813(x)(1), all obligations of the Bank under this contract shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

(d) All obligations of the Bank under this contract shall be terminated, except to the extent it is determined that continuation of the contract is necessary for the continued operation of the Bank: (i) by the Comptroller of the Office of the Comptroller of the Currency (“OCC”) or its successor, or his designee, or the FDIC, at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. §1823(c); or (ii) by the Comptroller of the OCC or its successor (or his designee) at the time the Comptroller (or his designee) approves a supervisory merger to resolve problems related to the operations of the Bank, or when the Bank is determined by the Comptroller to be in an unsafe or unsound condition. Any rights of the parties that have already vested, however, shall not be affected by such action.

(e) Any payments made to Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon compliance with 12 U.S.C. §1828(k) and any rules and regulations promulgated thereunder, including 12 C.F.R. Part 359, and to the extent applicable 12 C.F.R. §163.39.

20. Dispute Resolution.

(a) If a dispute arises out of or relates to this Agreement, or the breach hereof, and if such dispute is not settled within a commercially reasonably time (not to exceed sixty (60) days, through negotiations), the parties shall attempt in good faith to settle the dispute by mediation under the Employment Arbitration Rules and Mediation Procedures of the American Arbitration Association as then in effect (the “Rules”) before resorting to litigation. No resolution or attempted resolution of any dispute or disagreement pursuant to this Section 20 shall be deemed to be a waiver of any term or provision of this Agreement or a consent to any breach or default, unless such waiver or consent shall be in writing and signed by the party claimed to have waived or consented.

(b) Any dispute or controversy not settled in accordance with the foregoing provisions of this Section 20 shall be settled exclusively by binding arbitration to be conducted before a single arbitrator mutually acceptable to the Bank and Executive in a location within twenty-five (25) miles of the Bank’s headquarters in the State of New York, in accordance with the Rules.

(c) The parties covenant and agree that they will participate in such mediation and/or arbitration in good faith and that the Bank, subject to Section 20(e), will bear the fees and expenses of such proceeding charged by the American Arbitration Association (including the fees of the arbitrators). In an arbitration, the arbitrator shall not have the power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages or any other damages, and each party hereby irrevocably waives any claim to such damages.

(d) Any payment required under this Section 20 shall be made after the final resolution referenced herein, but not later than the later of (i) December 31 of the calendar year in which such resolution is achieved, and (ii) two and one-half months after the date on which such final resolution is achieved.

(e) The prevailing party in any arbitration proceeding or any other legal proceeding between the Executive and the Bank, shall be entitled to reimbursement from the other party for all reasonable attorneys’ fees, costs and expenses that such prevailing party incurs in connection with any such proceeding.

13

21. Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be taken to be an original; but such counterparts shall together constitute one and the same document. Transmission by facsimile, email, or other form of electronic transmission of an executed counterpart of this Agreement shall be deemed to constitute due and sufficient delivery of such counterpart.

22. Successors to the Bank. The Bank shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Bank expressly to assume and agree to perform the Bank’s obligations under this Agreement to the same extent that the Bank would be required to perform it if no succession had taken place. Failure of the Bank to obtain an assumption of this Agreement at or prior to the effectiveness of any succession shall be a material breach of this Agreement.

23. No Mitigation. The Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise. No payment provided for in this Agreement shall be reduced by any compensation earned by the Executive as the result of employment by another employer, or the Executive’s receipt of income from any other sources, after termination of his employment with the Bank.

24. Compliance with Dodd–Frank Wall Street Reform and Consumer Protection Act. Notwithstanding anything to the contrary herein, any incentive payments to the Executive shall be limited to the extent required under the Dodd–Frank Wall Street Reform and Consumer Protection Act (the “Act”), including, but not limited to, clawbacks for such incentive payments as required by the Act. The Executive agrees to such amendments, agreements, or waivers that are required by the Act or requested by the Bank to comply with the terms of the Act.

14

IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by the Bank, by its duly authorized officers, and by the Executive, as of the first date written above.

15