10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

x        ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For fiscal year ended December 31, 2008

o        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For transition period from                   to                   

Commission File Number 000 – 17609

WEST SUBURBAN BANCORP, INC.

(Exact name of Registrant as specified in its charter)

Illinois	36-3452469
(State or other jurisdiction	(I.R.S. Employer Identification Number)
of incorporation or organization)
711 South Meyers Road, Lombard, Illinois	60148
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (630) 652-2000

Securities registered pursuant to Section 12(b) of the Act:

	Name of Each Exchange
Title of Each Class	on which Registered
None	None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, no par value

(Title of Class)

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  o    No  x

Indicate by check mark if Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes  o    No  x

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  x    No  o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “small reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  o	Accelerated filer  x
Non-accelerated filer  o  (Do not check if a smaller reporting company)	Smaller reporting company  o

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes  o    No  x

The aggregate fair value of voting common stock of Registrant held by non-affiliates as of June 30, 2008 was $149,327,178. (1)

At March 4, 2009, the total number of shares of Common Stock outstanding was 430,011.

Documents Incorporated by Reference:

Portions of the Annual Report to Shareholders for the fiscal year ended December 31, 2008, which is included as Exhibit 13 to this Form 10-K, are incorporated by reference into Parts I, II and IV hereof, to the extent indicated herein. Portions of the Proxy Statement for the Annual Meeting of Shareholders to be held May 13, 2009 are incorporated by reference in Part III hereof, to the extent indicated herein.

(1)          Based on the last independently appraised fair value of the Registrant’s common stock as of February 5, 2009, and reports of beneficial ownership filed by directors and executive officers of Registrant and by beneficial owners of more than 5% of the outstanding shares of common stock of Registrant; however, such determination of shares owned by affiliates does not constitute an admission of affiliate status or beneficial interest in shares of common stock of Registrant.

Special Note Concerning Forward-Looking Statements

This document (including information incorporated by reference) contains, and future oral and written statements of West Suburban Bancorp, Inc. (“West Suburban”) and West Suburban Bank (the “Bank” and collectively with West Suburban and its other direct and indirect subsidiaries, the “Company”) and its management may contain, forward-looking statements, within the meaning of such term in the Private Securities Litigation Reform Act of 1995, with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have a material adverse effect on the operations and future prospects of the Company include, but are not limited to, those set fourth in the “Risk Factors” section included under Item 1A and the following:

·The strength of the U.S. and global economies and financial markets in general and the strength of the local economies in which the Company conducts its operations, including the local residential and commercial real estate markets, which may be less favorable than expected and may result in, among other things, a deterioration in the credit quality and value of the Company’s assets.

·The effects of, and changes in, federal, state and local laws, regulations and policies affecting banking, securities, taxation, insurance and monetary and financial matters, as well as any laws and regulations otherwise affecting the Company, including laws and regulations intended to address the current stresses in the U.S. and global financial markets, national security and money laundering.

·The effects of continued adverse market conditions and further volatility in investment securities generally, which may result in a deterioration in the value of the securities in the Company’s investment portfolio.

·The ability of the Company to comply with applicable federal, state and local laws, regulations and policies and the consequences that may result from any such inability to comply.

·The effects of changes in interest rates (including the effects of changes in the rate of prepayments of the Company’s assets) and the policies of the Board of Governors of the Federal Reserve System.

·The ability of the Company to compete with other financial institutions as effectively as the Company currently intends due to increases in competitive pressures in the financial services sector.

·The ability of the Company to maintain an acceptable net interest margin.

·The ability of the Company to obtain new customers and to retain existing customers.

·The timely development and acceptance of products and services, including products and services offered through alternative delivery channels such as the Internet.

·Technological changes implemented by the Company and by other parties, including third party vendors, which may be more difficult or more expensive than anticipated or which may have unforeseen consequences to the Company and its customers, including technological changes implemented for, or related to, the Company’s website or new products such as prepaid solutions cards, payroll cards and other similar products and services.

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·The ability of the Company, and certain of its vendors, to develop and maintain secure and reliable electronic systems, including systems developed for the Company’s website or new products such as prepaid solutions cards, payroll cards and other similar products and services.

·The ability of the Company to retain key executives and employees, and the difficulty that the Company may experience in replacing key executives and employees in an effective manner.

·Consumer spending and saving habits which may change in a manner that affects the Company’s business adversely.

·The economic impact of past and any future terrorist attacks, acts of war or threats thereof and the response of the U.S. to any such attacks and threats.

·Business combinations and the integration of acquired businesses, which may be more difficult or expensive than expected.

·The costs, effects and outcomes of existing or future litigation and disputes with third parties.

·Changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies and the Financial Accounting Standards Board, the Public Company Accounting Oversight Board and the Securities and Exchange Commission.

·Credit risks and the risks from concentrations (by geographic area or industry) within the Company’s loan portfolio.

·The failure of the Company’s Real Estate Investment Trust (“REIT”) to qualify as a REIT and the effects of such failure on the Company’s consolidated effective tax rate.

·The ability of the Company to manage the risks associated with the foregoing as well as anticipated.

These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including other factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

PART I

ITEM 1.        BUSINESS

REGISTRANT AND ITS SUBSIDIARY

West Suburban Bancorp, Inc., an Illinois corporation organized in 1986, is a bank holding company registered under the Bank Holding Company Act of 1956, as amended (the “BHCA”), and the parent company of West Suburban Bank.

The Bank is headquartered in Lombard, Illinois, and, as of December 31, 2008, maintained 34 full-service branches, five limited-service branches and five departments providing insurance, financial and other services for the convenience of the customers of the Bank throughout the western suburbs of Chicago. Due to the nature of the market areas served by the Bank, the Bank provides a wide range of financial services to individuals and small to medium sized businesses. The western suburbs of Chicago have a diversified economy with many corporate headquarters and numerous small to medium sized industrial and non-industrial businesses.

The Bank engages in a general full service retail banking business and offers a broad variety of consumer and commercial products and services. The Bank also offers insurance services through West Suburban Insurance Services, Inc., land trust services, stored value card products through the Prepaid Solutions Group and safe deposit

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boxes. The Bank provides extended banking hours, including Sunday hours and 24-hour banking through a proprietary network of 62 automated teller machines, Tele-Bank 24 (a bank-by-phone system) and online banking at www.westsuburbanbank.com. Other consumer related services are also available, including investment products and a Visa card through West Suburban Bank Card Services.

The following table sets forth financial and other information concerning the Bank as of and for the year ended December 31, 2008 (dollars in thousands):

Year Formed/Year
Affiliated with	Number of	Total		Shareholders’		Net		Return on Average
West Suburban	Locations	Assets		Equity		Income		Assets		Equity
West Suburban Bank
(1962/1988)	39	$	1,861,937	$	144,822	$	16,735	0.90	%	11.66	%

COMPETITION

The Company encounters competition in all areas of its business pursuits. It competes for loans, deposits, fiduciary and other services with financial and other institutions located both within and outside of its market area. As of February 28, 2009, the Company estimates that there were 91 other financial institutions operating over 675 separate banking offices within the Company’s market area. The Company also faces competition from finance companies, insurance companies, mortgage companies, securities brokerage firms, money market funds, loan production offices and other providers of financial services. In order to compete effectively, develop its market base, maintain flexibility and move in pace with changing economic, technological and social conditions, the Company continuously refines and develops its products and services. The principal methods of competition in the financial services industry are price, service and convenience.

EMPLOYEES

At December 31, 2008, the Company employed 627 persons (533 full-time equivalent employees). The Company believes that its relationship with its employees is good. None of the Company’s employees are covered by a collective bargaining agreement with the Company.

SUPERVISION AND REGULATION

General

Financial institutions, their holding companies and their affiliates are extensively regulated under federal and state law. As a result, the growth and earnings performance of the Company may be affected not only by management decisions and general economic conditions, but also by the requirements of federal and state statutes and by the regulations and policies of various bank regulatory authorities, including the Illinois Department of Financial and Professional Regulation (the “DFPR”), the Board of Governors of the Federal Reserve System (the “Federal Reserve”) and the Federal Deposit Insurance Corporation (the “FDIC”). Furthermore, taxation laws administered by the Internal Revenue Service and state taxing authorities and securities laws administered by the Securities and Exchange Commission (the “SEC”) and state securities authorities have an impact on the business of the Company. The effect of these statutes, regulations and regulatory policies may be significant, and cannot be predicted with a high degree of certainty.

Federal and state laws and regulations generally applicable to financial institutions regulate, among other things, the scope of business, the kinds and amounts of investments, reserve requirements, capital levels relative to operations, the nature and amount of collateral for loans, the establishment of branches, mergers and consolidations and the payment of dividends. This system of supervision and regulation establishes a comprehensive framework for the respective operations of the Company and its subsidiaries and is intended primarily for the protection of the FDIC-insured deposits and depositors of the Bank, rather than shareholders. In addition to this generally applicable regulatory framework, recent turmoil in the credit markets prompted the enactment of unprecedented legislation that has allowed the U.S. Treasury to make equity capital available to qualifying financial institutions to help restore

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confidence and stability in the U.S. financial markets, which imposes additional requirements on institutions in which the U.S. Treasury invests.

The following is a summary of the material elements of the regulatory framework that applies to the Company and its subsidiaries. It does not describe all of the statutes, regulations and regulatory policies that apply, nor does it restate all of the requirements of those that are described. As such, the following is qualified in its entirety by reference to applicable law. Any change in statutes, regulations or regulatory policies may have a material effect on the business of the Company and its subsidiaries.

The Company

General.The Company, as the sole shareholder of the Bank, is a bank holding company. As a bank holding company, the Company is registered with, and is subject to regulation by, the Federal Reserve under the BHCA. In accordance with Federal Reserve policy, the Company is expected to act as a source of financial strength to the Bank and to commit resources to support the Bank in circumstances where the Company might not otherwise do so. Under the BHCA, the Company is subject to periodic examination by the Federal Reserve. The Company is also required to file with the Federal Reserve periodic reports of the Company’s operations and such additional information regarding the Company and its subsidiaries as the Federal Reserve may require.

Acquisitions, Activities and Change in Control.In general, a bank holding company is in the business of controlling and managing banks. The BHCA requires the prior approval of the Federal Reserve for any merger involving a bank holding company or any acquisition by a bank holding company of another bank or bank holding company. Subject to certain conditions (including certain deposit concentration limits established by the BHCA), the Federal Reserve may allow a bank holding company to acquire banks located in any state of the U.S. In approving interstate acquisitions, the Federal Reserve is required to give effect to applicable state law limitations on the aggregate amount of deposits that may be held by the acquiring bank holding company and its insured depository institution affiliates in the state in which the target bank is located (provided that those limits do not discriminate against out-of-state depository institutions or their holding companies) and state laws that require that the target bank have been in existence for a minimum period of time (not to exceed five years) before being acquired by an out-of-state bank holding company.

The BHCA generally prohibits the Company from acquiring direct or indirect ownership or control of more than 5% of the voting shares of any company that is not a bank and from engaging in any business other than that of banking, managing and controlling banks or furnishing services to banks and their subsidiaries. This general prohibition is subject to a number of exceptions. The principal exception allows bank holding companies to engage in, and to own shares of companies engaged in, certain businesses found by the Federal Reserve to be “so closely related to banking ... as to be a proper incident thereto.” This authority would permit the Company to engage in a variety of banking-related businesses, including the ownership and operation of a thrift or any entity engaged in consumer finance, equipment leasing, the operation of a computer service bureau (including software development), and mortgage banking and brokerage. The BHCA generally does not place territorial restrictions on the domestic activities of non-bank subsidiaries of bank holding companies.

Additionally, bank holding companies that meet certain eligibility requirements prescribed by the BHCA and elect to operate as financial holding companies may engage in, or own shares in companies engaged in, a wider range of nonbanking activities, including securities and insurance underwriting and sales, merchant banking and any other activity that the Federal Reserve, in consultation with the Secretary of the U.S. Treasury, determines by regulation or order is financial in nature, incidental to any such financial activity or complementary to any such financial activity and does not pose a substantial risk to the safety or soundness of depository institutions or the financial system generally. As of the date of this filing, the Company has not applied for approval to operate as a financial holding company.

Federal law also prohibits any person or company from acquiring “control” of an FDIC-insured depository institution or its holding company without prior notice to the appropriate federal bank regulator. “Control” is conclusively presumed to exist upon the acquisition of 25% or more of the outstanding voting securities of a bank or bank holding company, but may arise under certain circumstances between 10% and 24.99% ownership.

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Capital Requirements.  Bank holding companies are required to maintain minimum levels of capital in accordance with Federal Reserve capital adequacy guidelines. If capital levels fall below the minimum required levels, a bank holding company, among other things, may be denied approval to acquire or establish additional banks or non-bank businesses.

The Federal Reserve’s capital guidelines establish the following minimum regulatory capital requirements for bank holding companies: (i) a risk-based requirement expressed as a percentage of total assets weighted according to risk; and (ii) a leverage requirement expressed as a percentage of total assets. The risk-based requirement consists of a minimum ratio of total capital to total risk-weighted assets of 8% and a minimum ratio of Tier 1 capital to total risk-weighted assets of 4%. The leverage requirement consists of a minimum ratio of Tier 1 capital to total assets of 3% for the most highly rated companies, with a minimum requirement of 4% for all others. For purposes of these capital standards, Tier 1 capital consists primarily of permanent stockholders’ equity less intangible assets (other than certain loan servicing rights and purchased credit card relationships). Total capital consists primarily of Tier 1 capital plus certain other debt and equity instruments that do not qualify as Tier 1 capital and a portion of the company’s allowance for loan and lease losses.

The risk-based and leverage standards described above are minimum requirements. Higher capital levels may be required if warranted by the particular circumstances or risk profiles of individual banking organizations. For example, the Federal Reserve’s capital guidelines contemplate that additional capital may be required to take adequate account of, among other things, interest rate risk, or the risks posed by concentrations of credit, nontraditional activities or securities trading activities. Further, any banking organization experiencing or anticipating significant growth would be expected to maintain capital ratios, including tangible capital positions (i.e., Tier 1 capital less all intangible assets), well above the minimum levels. As of December 31, 2008, the Company had regulatory capital in excess of the Federal Reserve’s minimum requirements.

Dividend Payments.  The Company’s ability to pay dividends to its shareholders may be affected by both general corporate law considerations and policies of the Federal Reserve applicable to bank holding companies. As an Illinois corporation, the Company is subject to the Illinois Business Corporation Act, as amended, which prohibits the Company from paying a dividend if, after giving effect to the dividend: (i) the Company would be insolvent; or (ii) the net assets of the Company would be less than zero; or (iii) the net assets of the Company would be less than the maximum amount then payable to shareholders of the Company who would have preferential distribution rights if the Company were liquidated. Additionally, policies of the Federal Reserve caution that a bank holding company should not pay cash dividends unless its net income available to common shareholders over the past year has been sufficient to fully fund the dividends and the prospective rate of earnings retention appears consistent with its capital needs, asset quality, and overall financial condition. The Federal Reserve also possesses enforcement powers over bank holding companies and their non-bank subsidiaries to prevent or remedy actions that represent unsafe or unsound practices or violations of applicable statutes and regulations. Among these powers is the ability to proscribe the payment of dividends by banks and bank holding companies. Further, if the Company participates in the U.S. Treasury’s Capital Purchase Program, the Company anticipates that the terms of the preferred stock to be issued to the U.S. Treasury will provide that no dividends on any common or preferred stock that ranks equal to or junior to such preferred stock may be paid unless and until all accrued and unpaid dividends for all past dividend periods on the U.S. Treasury preferred stock have been fully paid.

Federal Securities Regulation.  The Company’s common stock is registered with the SEC under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Consequently, the Company is subject to the information, proxy solicitation, insider trading and other restrictions and requirements of the SEC under the Exchange Act.

The Bank

General.The Bank is an Illinois-chartered bank, the deposit accounts of which are insured by the FDIC to the maximum extent provided under federal law and FDIC regulations. As an Illinois-chartered bank, the Bank is subject to the examination, supervision, reporting and enforcement requirements of the DFPR, the chartering authority for Illinois banks, and the FDIC, designated by federal law as the primary federal regulator of state-chartered, FDIC-insured banks that, like the Bank, are not members of the Federal Reserve System (“non-member banks”).

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Deposit Insurance. As an FDIC-insured institution, the Bank is required to pay deposit insurance premium assessments to the FDIC. The FDIC has adopted a risk-based assessment system whereby FDIC-insured depository institutions pay insurance premiums at rates based on their risk classification. An institution’s risk classification is assigned based on its capital levels and the level of supervisory concern the institution poses to the regulators. Under the regulations of the FDIC, as presently in effect, insurance assessments range from 0.12% to 0.50% of total deposits for the first quarter 2009 assessment period only (subject to the application of assessment credits, if any, issued by the FDIC in 2008). Effective April 1, 2009, insurance assessments will range from 0.07% to 0.78% of total deposits, depending on an institution’s risk classification, its levels of unsecured debt and secured liabilities, and, in certain cases, its level of brokered deposits.  In addition, under an interim rule, the FDIC plans to impose an emergency special assessment on insured depository institutions on June 30, 2009. The emergency special assessment will be an amount equal to 0.2% of total deposits as of June 30, 2009, and will be collected on September 30, 2009.  The interim rule also authorizes the FDIC to impose additional emergency special assessments after June 30, 2009, of up to 0.1% of total deposits, whenever the FDIC estimates that the reserve ratio of the deposit insurance fund will fall to a level that the FDIC believes would adversely affect public confidence in federal deposit insurance or to a level that will be close to zero or negative at the end of a calendar quarter. The interim rule, however, is subject to a 30-day comment period that will expire on April 2, 2009, and may be subject to change before any special assessments are imposed on insured depository institutions.

FICO Assessments.  The Financing Corporation (“FICO”) is a mixed-ownership governmental corporation chartered by the former Federal Home Loan Bank Board pursuant to the Federal Savings and Loan Insurance Corporation Recapitalization Act of 1987 to function as a financing vehicle for the recapitalization of the former Federal Savings and Loan Insurance Corporation. FICO issued 30-year non-callable bonds of approximately $8.2 billion that mature by 2019. Since 1996, federal legislation has required that all FDIC-insured depository institutions pay assessments to cover interest payments on FICO’s outstanding obligations. These FICO assessments are in addition to amounts assessed by the FDIC for deposit insurance. During the year ended December 31, 2008, the FICO assessment rate was approximately 0.01% of deposits.

Supervisory Assessments.  All Illinois banks are required to pay supervisory assessments to the DFPR to fund the operations of the DFPR. The amount of the assessment is calculated on the basis of an institution’s total assets, including consolidated subsidiaries, as reported to the DFPR. During the year ended December 31, 2008, the Bank paid supervisory assessments to the DFPR totaling $.21 million.

Capital Requirements.  Banks are generally required to maintain capital levels in excess of other businesses. The FDIC has established the following minimum capital standards for state-chartered insured non-member banks, such as the Bank: (i) a leverage requirement consisting of a minimum ratio of Tier 1 capital to total assets of 3% for the most highly-rated banks with a minimum requirement of at least 4% for all others; and (ii) a risk-based capital requirement consisting of a minimum ratio of total capital to total risk-weighted assets of 8% and a minimum ratio of Tier 1 capital to total risk-weighted assets of 4%. In general, the components of Tier 1 capital and total capital are the same as those for bank holding companies discussed above.

The capital requirements described above are minimum requirements. Higher capital levels may be required if warranted by the particular circumstances or risk profiles of individual institutions. For example, regulations of the FDIC provide that additional capital may be required to take adequate account of, among other things, interest rate risk or the risks posed by concentrations of credit, nontraditional activities or securities trading activities.

Further, federal law and regulations provide various incentives for financial institutions to maintain regulatory capital at levels in excess of minimum regulatory requirements. For example, a financial institution that is “well-capitalized” may qualify for exemptions from prior notice or application requirements otherwise applicable to certain types of activities and may qualify for expedited processing of other required notices or applications. Additionally, one of the criteria that determines a bank holding company’s eligibility to operate as a financial holding company is a requirement that all of its financial institution subsidiaries be “well-capitalized.” Under the regulations of the FDIC, in order to be “well-capitalized” a financial institution must maintain a ratio of total capital to total risk-weighted assets of 10% or greater, a ratio of Tier 1 capital to total risk-weighted assets of 6% or greater and a ratio of Tier 1 capital to total assets of 5% or greater.

Federal law also provides the federal banking regulators with broad power to take prompt corrective action to resolve the problems of undercapitalized institutions. The extent of the regulators’ powers depends on whether the institution in question is “adequately capitalized,” “undercapitalized,” “significantly undercapitalized” or “critically undercapitalized,” in each case as defined by regulation. Depending upon the capital category to which an institution

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is assigned, the regulators’ corrective powers include: (i) requiring the institution to submit a capital restoration plan; (ii) limiting the institution’s asset growth and restricting its activities; (iii) requiring the institution to issue additional capital stock (including additional voting stock) or to be acquired; (iv) restricting transactions between the institution and its affiliates; (v) restricting the interest rate the institution may pay on deposits; (vi) ordering a new election of directors of the institution; (vii) requiring that senior executive officers or directors be dismissed; (viii) prohibiting the institution from accepting deposits from correspondent banks; (ix) requiring the institution to divest certain subsidiaries; (x) prohibiting the payment of principal or interest on subordinated debt; and (xi) ultimately, appointing a receiver for the institution.

As of December 31, 2008: (i) the Bank was not subject to a directive from the FDIC to increase its capital to an amount in excess of the minimum regulatory capital requirements; (ii) the Bank exceeded its minimum regulatory capital requirements under FDIC capital adequacy guidelines; and (iii) the Bank was “well-capitalized,” as defined by FDIC regulations.

Dividend Payments.  The primary source of funds for the Company is dividends from the Bank. Under the Illinois Banking Act, Illinois-chartered banks generally may not pay dividends in excess of their net profits.

The payment of dividends by any financial institution is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations, and a financial institution generally is prohibited from paying any dividends if, following payment thereof, the institution would be undercapitalized. As described above, the Bank exceeded its minimum capital requirements under applicable guidelines as of December 31, 2008. As of December 31, 2008, approximately $15.1 million was available to be paid as dividends by the Bank. Notwithstanding the availability of funds for dividends, however, the FDIC may prohibit the payment of any dividends by the Bank if the FDIC determines such payment would constitute an unsafe or unsound practice.

Insider Transactions.  The Bank is subject to certain restrictions imposed by federal law on extensions of credit to the Company, on investments in the stock or other securities of the Company and the acceptance of the stock or other securities of the Company as collateral for loans made by the Bank. Certain limitations and reporting requirements are also placed on extensions of credit by the Bank to its directors and officers, to directors and officers of the Company, to principal shareholders of the Company and to “related interests” of such directors, officers and principal shareholders. In addition, federal law and regulations may affect the terms upon which any person who is a director or officer of the Company or the Bank or a principal shareholder of the Company may obtain credit from banks with which the Bank maintains a correspondent relationship.

Safety and Soundness Standards.  The federal banking agencies have adopted guidelines that establish operational and managerial standards to promote the safety and soundness of federally insured depository institutions. The guidelines set forth standards for internal controls, information systems, internal audit systems, loan documentation, credit underwriting, interest rate exposure, asset growth, compensation, fees and benefits, asset quality and earnings.

In general, the safety and soundness guidelines prescribe the goals to be achieved in each area, and each institution is responsible for establishing its own procedures to achieve those goals. If an institution fails to comply with any of the standards set forth in the guidelines, the institution’s primary federal regulator may require the institution to submit a plan for achieving and maintaining compliance. If an institution fails to submit an acceptable compliance plan, or fails in any material respect to implement a compliance plan that has been accepted by its primary federal regulator, the regulator is required to issue an order directing the institution to cure the deficiency. Until the deficiency cited in the regulator’s order is cured, the regulator may restrict the institution’s rate of growth, require the institution to increase its capital, restrict the rates the institution pays on deposits or require the institution to take any action the regulator deems appropriate under the circumstances. Noncompliance with the standards established by the safety and soundness guidelines may also constitute grounds for other enforcement action by the federal banking regulators, including cease and desist orders and civil money penalty assessments.

Branching Authority.  Illinois banks, such as the Bank, have the authority under Illinois law to establish branches anywhere in the State of Illinois, subject to receipt of all required regulatory approvals.

Federal law permits state and national banks to merge with banks in other states subject to: (i) regulatory approval; (ii) federal and state deposit concentration limits; and (iii) state law limitations requiring the merging bank to have been in existence for a minimum period of time (not to exceed five years) prior to the merger. The establishment of

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new interstate branches or the acquisition of individual branches of a bank in another state (rather than the acquisition of an out-of-state bank in its entirety) is permitted only in those states the laws of which expressly authorize such expansion.

State Bank Investments and Activities.  The Bank generally is permitted to make investments and engage in activities directly or through subsidiaries as authorized by Illinois law. However, under federal law and FDIC regulations, FDIC-insured state banks are prohibited, subject to certain exceptions, from making or retaining equity investments of a type, or in an amount, that are not permissible for a national bank. Federal law and FDIC regulations also prohibit FDIC-insured state banks and their subsidiaries, subject to certain exceptions, from engaging as principal in any activity that is not permitted for a national bank unless the bank meets, and continues to meet, its minimum regulatory capital requirements and the FDIC determines the activity would not pose a significant risk to the deposit insurance fund of which the bank is a member. These restrictions have not had, and are not currently expected to have, a material impact on the operations of the Bank.

Federal Reserve System.  Federal Reserve regulations, as presently in effect, require depository institutions to maintain reserves against their transaction accounts (primarily NOW and regular checking accounts), as follows: for transaction accounts aggregating $44.4 million or less, the reserve requirement is 3% of total transaction accounts; and for transaction accounts aggregating in excess of $44.4 million, the reserve requirement is $1.023 million plus 10% of the aggregate amount of total transaction accounts in excess of $44.4 million. The first $10.3 million of otherwise reservable balances are exempted from the reserve requirements. These reserve requirements are subject to annual adjustment by the Federal Reserve. The Bank is in compliance with the foregoing requirements.

Recent Regulatory Issues

On December 3, 2008, the Bank entered into an Order to Cease and Desist (the “Order”) with the FDIC and the DFPR, which is based on FDIC and DFPR findings that the Bank’s Secrecy Act/Anti-Money Laundering Program (“BSA/AML Program”) was inadequate and that the Bank had violated various laws and regulations related to the Bank Secrecy Act (the “BSA”). The Order requires the Bank to take certain corrective actions aimed at resolving any outstanding violations of BSA-related laws or regulations and to implement a revised BSA/AML Program, which is designed to ensure compliance with these BSA-related laws and regulations. The Order also requires the Bank to, among other things, assess its BSA Department staffing needs, provide for independent testing of BSA/AML Program compliance, conduct a review of certain historical deposit and transaction activity and submit periodic reports of progress to the FDIC and DFPR.

The Order does not relate to the Bank’s asset quality, capital position or the safety and soundness of its financial operations. The Bank has begun taking the corrective actions required by the Order to address its BSA/AML compliance issues.

RECENT DEVELOPMENTS

The Credit Crisis and the Emergency Economic Stabilization Act of 2008

Recent events in the U.S. and global financial markets, including the deterioration of the worldwide credit markets, have created significant challenges for financial institutions both in the U.S. and around the world. Dramatic declines in the housing market during the past year, marked by falling home prices and increasing levels of mortgage foreclosures and unemployment, have resulted in significant write-downs of asset values by financial institutions, including government-sponsored entities and major commercial and investment banks. These write-downs, initially of residential-related loans and mortgage-backed securities, but spreading to credit default swaps and other derivative securities, have caused many financial institutions to seek additional capital, to merge with larger and stronger institutions and, in some cases, to fail.

Reflecting concern about the stability of the financial markets generally and the strength of counterparties, many lenders and institutional investors have reduced, and in some cases, ceased to provide funding to borrowers, including other financial institutions. The availability of credit, confidence in the financial sector, and level of volatility in the financial markets have been significantly adversely affected as a result. In recent months, volatility

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and disruption in the capital and credit markets have reached unprecedented levels. In some cases, the markets have produced downward pressure on stock prices and credit capacity for certain institutions without regard to those institutions’ underlying financial strength.

In response to the financial crises affecting the banking system and financial markets and going concern threats to investment banks and other financial institutions, on October 3, 2008, President Bush signed into law, the Emergency Economic Stabilization Act of 2008 (the “EESA”). The EESA authorizes the U.S. Treasury to implement various temporary emergency programs designed to strengthen the capital positions of financial institutions and stimulate the availability of credit within the U.S. financial system. Pursuant to the EESA, the U.S. Treasury has the authority to, among other things, purchase up to $700 billion of mortgages, mortgage-backed securities and certain other financial instruments from financial institutions for the purpose of stabilizing and providing liquidity to the U.S. financial markets. The EESA also provided a temporary increase in deposit insurance coverage from $100,000 to $250,000 per insured account until December 31, 2009.

On October 14, 2008, the U.S. Treasury announced that it will provide Tier 1 capital (in the form of senior perpetual preferred stock) to eligible financial institutions. This program, known as the Troubled Asset Relief Program Capital Purchase Program (the “Capital Purchase Program”), allocates $250 billion from the $700 billion authorized by the EESA to the U.S. Treasury for the purchase of senior preferred shares from qualifying financial institutions. Eligible institutions will be able to sell equity interests to the U.S. Treasury in amounts equal to between 1% and 3% of the institution’s risk-weighted assets. Participating financial institutions will be required to adopt the U.S. Treasury’s standards for executive compensation and corporate governance for the period during which the U.S. Treasury holds equity issued under the Capital Purchase Program. The U.S. Treasury will determine the specific allocation, if any, for an interested financial institution after consultation with the appropriate federal banking agency.

The Company’s Potential Participation in the Capital Purchase Program

The Company has applied to receive up to $43 million in funds from the U.S. Treasury under the Capital Purchase Program based on the Company’s total risk-weighted assets of approximately $1.46 billion as of September 30, 2008. As of the date of this annual report, this application is being reviewed by the regulators. If the Company’s application is approved and it accepts the terms of the investment, the Company will be subject to restrictions with respect to executive compensation matters, as well as to additional agreements that may restrict the Company’s operations. The Company also expects that its federal regulators and the U.S. Treasury will maintain significant oversight over the Company as a participating institution to evaluate how the Company uses the capital provided and to ensure that the Company strengthens its efforts to help borrowers under the Company’s loans to avoid foreclosure, which is one of the core aspects of the EESA.

FDIC’s Temporary Liquidity Guarantee Program

As another component of the EESA, the U.S. Treasury has authorized the FDIC to provide a 100% guarantee of the following: (i) newly-issued senior unsecured debt and (ii) non-interest bearing transactional deposit accounts maintained at FDIC-insured institutions. This program is known as the Temporary Liquidity Guarantee Program, with the guarantee of senior unsecured debt referred to as the Debt Guarantee Program (the “DGP”) and the guarantee of non-interest bearing transactional accounts referred to as the Transaction Account Guarantee Program (the “TAGP”). FDIC insured institutions and their holding companies were required to opt in or out of each of the DGP and the TAGP by December 5, 2008. All insured depository institutions automatically participated in the Temporary Liquidity Guarantee Program for 30 days following the announcement of the program without charge (subsequently extended to December 5, 2008) and thereafter, unless an institution opted out, at a cost of 75 basis points per annum for senior unsecured debt and 10 basis points per annum for noninterest-bearing transaction deposits. The Company opted to continue its participation in the TAGP, but the Company decided to opt out of the DGP.

The American Recovery and Reinvestment Act of 2009

On February 17, 2009, President Obama signed into law, The American Recovery and Reinvestment Act of 2009 (“ARRA”), which is more commonly known as the economic stimulus or economic recovery package. ARRA includes a wide variety of programs intended to stimulate the economy and provide for extensive infrastructure,

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energy, health and education needs. In addition, ARRA imposes new executive compensation and corporate governance limits on current and future participants in the Capital Purchase Program, which are in addition to those previously announced by the U.S. Treasury. The new limits remain in place until the participant has redeemed the preferred stock sold to the U.S. Treasury, which is now permitted under ARRA without penalty and without the need to raise new capital, subject to the U.S. Treasury’s consultation with the recipient’s appropriate federal regulator.

It is not clear at this time what impact the EESA, the Capital Purchase Program, the TLGP, or other liquidity and funding initiatives will have on the financial markets and the other difficulties described above, including the high levels of volatility and limited credit availability currently being experienced, or on the U.S. banking and financial industries and the broader U.S. global economies. Further adverse effects could have an adverse effect on our business.

AVAILABLE INFORMATION

The Company’s Internet address is www.westsuburbanbank.com. The Company makes available free of charge on or through its Internet website its annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after the reports are electronically filed with, or furnished to, the Securities and Exchange Commission.

EXECUTIVE OFFICERS OF WEST SUBURBAN

The names and ages of the executive officers of West Suburban, along with a brief description of the business experience of each person during the past five years, and certain other information is set forth below:

Name (Age) and Position and Offices with West Suburban (year first elected to office)	Principal Occupations and Employment for Past Five Years and Other Information
Kevin J. Acker (59) Chairman and Chief Executive Officer (1993) and Vice President (1986)	Senior Vice President, Marketing of the Bank since 1997
Keith W. Acker (59) Chief Operations Officer (1996)	Director, President and Trust Officer of the Bank since 1986
Duane G. Debs (52) President (1997) and Chief Financial Officer (1993)	Senior Vice President, Trust Officer of the Bank since 1997 and Vice President, Comptroller of the Bank since 1987
Michael P. Brosnahan (59) Vice President (1997)	Senior Vice President, Lending of the Bank since 1989

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STATISTICAL DATA

The statistical data required by Exchange Act Industry Guide 3, “Statistical Disclosure By Bank Holding Companies,” has been incorporated by reference from the Company’s 2008 Annual Report to Shareholders (attached as Exhibit 13 hereto) or is set forth below. This data should be read in conjunction with the Company’s 2008 Consolidated Financial Statements and related notes, and the discussion included in Management’s Discussion and Analysis of Financial Condition and Results of Operations as set forth in the Company’s 2008 Annual Report to Shareholders.

Securities

The following table sets forth by category the amortized cost of securities at December 31 (dollars in thousands):

	2008		2007		2006
Available for sale
Corporate	$	24,430	$	35,489	$	41,384
Trust preferred	8,511		8,577		5,000
U.S. government sponsored entities	22,170		195,193		224,276
Mortgage-backed	162,062		207,302		176,784
States and political subdivisions	10,160		13,918		13,700
Preferred stock	—		621		1,003
Total securities available for sale	227,333		461,100		462,147
Held to maturity
U.S. government sponsored entities	28,072		—		17,597
Mortgage-backed	193,187		11,450		13,882
States and political subdivisions	18,975		12,626		13,534
Total securities held to maturity	240,234		24,076		45,013
Federal Home Loan Bank stock	6,144		5,258		5,091
Total securities	$	473,711	$	490,434	$	512,251

The following table sets forth, by contractual maturity, the amortized cost and weighted average yield of debt securities available for sale at December 31, 2008. Although the mortgage-backed securities are listed by contractual maturity, the effective maturity is significantly shorter due to regularly scheduled payments and prepayments of principal. Yields on tax-exempt securities represent tax equivalent yields, net of premium amortization and discount accretion (dollars in thousands):

	Corporate				U.S. Government Sponsored Entities				Mortgage-backed				States and Political Subdivisions
	Amortized Cost		Weighted Average Yield		Amortized Cost		Weighted Average Yield		Amortized Cost		Weighted Average Yield		Amortized Cost		Weighted Average Yield
Within 1 year	$	9,954	4.34	%	$	3,020	3.74	%	$	1,651	3.73	%	$	1,887	4.44	%
After 1 year but within 5 years	14,476		4.26	%	19,150		4.10	%	14,834		3.76	%	2,795		4.64	%
After 5 years but within 10 years	—		—	%	—		—	%	44,740		5.47	%	1,091		6.37	%
After 10 years	—		—	%	—		—	%	100,837		5.20	%	4,387		6.15	%
Total	$	24,430	4.29	%	$	22,170	4.05	%	$	162,062	5.12	%	$	10,160	5.44	%

Trust preferred securities with an amortized cost of $8.5 million had contractual maturities greater than 10 years and a weighted average yield of 3.60%. Income on Federal Home Loan Bank stock is dependent on the declaration of dividends by the Federal Home Loan Bank.

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The following table sets forth, by contractual maturity, the amortized cost and weighted average yield of securities held to maturity at December 31, 2008. Although the mortgage-backed securities are listed by contractual maturity, the effective maturity is significantly shorter due to regularly scheduled payments and prepayments of principal. Yields on tax-exempt securities represent tax equivalent yields, net of premium amortization and discount accretion (dollars in thousands):

	U.S. Government Sponsored Entities				Mortgage-backed				States and Political Subdivisions
	Amortized Cost		Weighted Average Yield		Amortized Cost		Weighted Average Yield		Amortized Cost		Weighted Average Yield
Within 1 year	$	—	—	%	$	—	—	%	$	2,540	7.35	%
After 1 year but within 5 years	10,002		4.01	%	—		—	%	3,175		4.35	%
After 5 years but within 10 years	18,070		4.13	%	35,941		4.46	%	3,529		5.62	%
After 10 years	—		—	%	157,246		4.79	%	9,731		5.95	%
Total	$	28,072	4.09	%	$	193,187	4.73	%	$	18,975	5.81	%

No securities holdings of a single issuer, other than U.S. government sponsored entities, exceed 10% of the shareholders’ equity of the Company at December 31, 2008. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Approximately $21.1 million of securities are callable in 2009. Most of these callable securities were issued by U.S. government sponsored entities.

Loan Portfolio

The following table sets forth the major loan categories at December 31 (dollars in thousands):

	2008			2007			2006			2005			2004
Commercial	$	288,234		$	270,293		$	282,826		$	276,898		$	267,799
Consumer	4,276			5,653			6,821			7,501			7,552
Indirect automobile	4,454			8,559			13,855			24,939			38,651
Real estate
Residential	242,947			224,755			177,885			160,902			146,259
Commercial	276,995			249,836			232,865			225,794			207,978
Home equity	257,150			272,098			240,720			229,514			237,622
Construction	161,532			191,952			197,528			165,484			135,264
Held for sale	1,768			350			—			140			329
Credit card	10,484			11,191			10,375			10,545			14,682
Other	1,333			1,153			1,660			711			516
Total	1,249,173			1,235,840			1,164,535			1,102,428			1,056,652
Allowance for loan losses	(15,578		)	(9,269		)	(10,650		)	(10,681		)	(10,527		)
Loans, net	$	1,233,595		$	1,226,571		$	1,153,885		$	1,091,747		$	1,046,125

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The following table sets forth the maturity and interest rate sensitivity of selected loan categories at December 31, 2008 (dollars in thousands):

	Remaining Maturity
	One year or less		One to five years		Over five years		Total
Commercial	$	194,934	$	79,882	$	13,418	$	288,234
Real estate-construction	116,057		45,475		—		161,532
Other loans	16,008		82,620		700,779		799,407
Total	$	326,999	$	207,977	$	714,197	$	1,249,173
Variable rate	$	301,761	$	107,899	$	398,366	$	808,026
Fixed rate	25,238		100,078		315,831		441,147
Total	$	326,999	$	207,977	$	714,197	$	1,249,173

Nonperforming Loans

The following table sets forth the aggregate amount of nonperforming loans and selected ratios at December 31 (dollars in thousands):

	2008			2007			2006			2005			2004
Loans past due 90 days or more still on accrual	$	1,705		$	480		$	319		$	1,665		$	1,036
Nonaccrual loans	23,569			2,297			1,131			533			3,815
Total nonperforming loans	25,274			2,777			1,450			2,198			4,851
Other real estate	4,658			824			351			210			3,156
Total nonperforming assets	$	29,932		$	3,601		$	1,801		$	2,408		$	8,007
Nonperforming loans as a percent of total loans	2.0		%	0.2		%	0.1		%	0.2		%	0.5		%
Nonperforming assets as a percent of total assets	1.6		%	0.2		%	0.1		%	0.1		%	0.5		%

The Company’s general policy is to discontinue accruing interest on a loan when it becomes 90 days past due or, on an earlier date, if management believes, after considering economic and business conditions and collection efforts, that the borrower’s financial condition is such that collection of principal or interest is doubtful. In some circumstances, a loan that is more than 90 days past due can remain on accrual status if it is fully secured and in process of collection. When a loan has been placed on nonaccrual, interest earned but not collected is charged back to interest income. When payments are received on nonaccrual loans, the payment is first applied to principal, then to interest income and finally to expenses incurred for collection. Potential problem loans are loans included on a watch list presented to the board of directors that do not meet the definition of a nonperforming loan. Our decision to include performing loans on a watch list does not necessarily mean that we expect losses to occur or that we believe these loans to be impaired, rather, that we believe a higher degree of monitoring is appropriate for these loans. Potential problem loans as of December 31, 2008 were $38.4 million.

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Allowance for Loan Losses

The Company maintains an allowance for loan losses at a level management believes is sufficient to absorb probable incurred credit losses in the loan portfolio. The allowance for loan losses represents the Company’s estimate of probable incurred credit losses in the loan portfolio at each balance sheet date and is based on the review of available and relevant information. The allowance contains allocations for probable incurred credit losses that have been identified relating to specific borrowing relationships as well as probable incurred credit losses for pools of loans. The allowance for loan losses is evaluated monthly by the Company to determine the appropriate level of the allowance. The amount of the allowance for loan losses is determined based on a variety of factors, including assessment of the credit risk of the loans in the loan portfolio, volume of the loans, delinquent loans, evaluation of current economic conditions in the market area, actual charge-offs during the period and historical loss experience. Loan quality is continually monitored by management and reviewed by the loan committee on a monthly basis.

All categories of loans are evaluated on a category by category basis. In addition, individual commercial, construction and commercial mortgage loans are evaluated to determine if a specific loss allocation is needed for problem loans deemed to have a shortfall in collateral. Management also considers the borrower’s current economic status including liquidity and future business viability. Other factors used in the allocation of the allowance include levels and trends of past dues and charge-offs along with concentrations of credit within the commercial and commercial real estate loan portfolios. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available or as future events occur. Along with the allocation of the allowance on a category by category basis and the specific allocations for individual borrowing relationships, the allowance includes a relatively small portion that remains unallocated.

Management adjusts the allowance for loan losses by recording a provision for loan losses in an amount sufficient to maintain the allowance at the level determined appropriate. Loans are charged-off when deemed to be uncollectible by management. The Company believes that the allowance for loan losses is adequate to provide for estimated probable incurred credit losses in the loan portfolio.

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The following table sets forth the activity in the allowance for loan losses for the years ended and at December 31 (dollars in thousands):

	2008			2007			2006			2005			2004
Allowance for loan losses at beginning of period	$	9,269		$	10,650		$	10,681		$	10,527		$	14,420
Loan charge-offs
Commercial	1,848			1,446			72			1,250			3,936
Consumer	10			17			5			12			31
Indirect automobile	20			37			62			79			113
Real estate
Residential	3			—			—			—			—
Commercial	13			—			—			—			164
Home equity	288			275			11			—			12
Construction	1,708			—			—			—			—
Credit card	321			210			196			192			236
Other	84			61			72			56			72
Total loan charge-offs	4,295			2,046			418			1,589			4,564
Loan recoveries
Commercial	142			129			144			252			315
Consumer	5			5			6			4			3
Indirect automobile	25			59			37			47			65
Real estate
Residential	—			—			—			—			—
Commercial	—			—			—			—			—
Home equity	—			—			—			—			—
Construction	—			—			—			—			—
Credit card	48			91			39			57			73
Other	24			6			11			8			15
Total loan recoveries	244			290			237			368			471
Net loan charge-offs	4,051			1,756			181			1,221			4,093
Provision for loan losses	10,360			375			150			1,375			200
Allowance for loan losses at end of period	$	15,578		$	9,269		$	10,650		$	10,681		$	10,527
Allowance for loan losses to total loans	1.25		%	0.75		%	0.91		%	0.97		%	1.00		%
Net charge-offs to average total loans	0.33		%	0.15		%	0.02		%	0.11		%	0.39		%

The amount of the additions to the allowance for loan losses charged to expense for the periods indicated were based on a variety of factors, including actual loans charged-off during the respective year, historical loss experience, changes in the nature and volume of the loan portfolio including nonperforming loans, specific loss allocations for individual loans and an evaluation of current economic conditions.

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The allocation shown in the following table, encompassing the major segments of the loan portfolio, represents only an estimate for each category of loans based on historical loss experience and management’s judgment of amounts deemed reasonable to provide for probable losses within each category.

Estimated losses for categories of homogeneous loan types are generally made on an aggregate basis (dollars in thousands).

	2008				2007				2006				2005				2004
	Amount		Percent of Loans in Each Category to Total Loans		Amount		Percent of Loans in Each Category to Total Loans		Amount		Percent of Loans in Each Category to Total Loans		Amount		Percent of Loans in Each Category  to Total Loans		Amount		Percent of Loans in Each Category  to Total Loans
Commercial	$	5,620	23.1	%	$	4,038	21.9	%	$	7,151	24.3	%	$	6,616	25.1	%	$	6,131	25.3	%
Consumer (1)	106		0.3	%	193		0.6	%	179		0.7	%	154		0.7	%	163		0.7	%
Indirect automobile	33		0.4	%	42		0.7	%	60		1.2	%	117		2.3	%	189		3.7	%
Real estate
Residential (2)	1,224		19.5	%	675		18.2	%	285		15.3	%	354		14.6	%	366		13.9	%
Commercial	3,863		22.2	%	1,249		20.2	%	489		20.0	%	609		20.5	%	624		19.7	%
Home equity	1,337		20.6	%	926		22.0	%	746		20.7	%	826		20.8	%	856		22.5	%
Construction	3,003		12.9	%	1,607		15.5	%	1,481		16.9	%	1,489		15.0	%	1,637		12.8	%
Credit card	305		1.0	%	250		0.9	%	242		0.9	%	258		1.0	%	302		1.4	%
Unallocated	87		—	%	289		—	%	17		—	%	258		—	%	259		—	%
Total	$	15,578	100.0	%	$	9,269	100.0	%	$	10,650	100.0	%	$	10,681	100.0	%	$	10,527	100.0	%

(1)Consumer loans include consumer and other loans.

(2)Residential real estate loans include real estate loans - held for sale.

Deposits

The following table sets forth by category average daily deposits and interest rates for the years ended December 31 (dollars in thousands):

	2008				2007				2006
	Average Balance		Rate		Average Balance		Rate		Average Balance		Rate
Demand-noninterest-bearing	$	138,106	—	%	$	145,314	—	%	$	152,423	—	%
NOW	307,033		0.4	%	306,680		0.9	%	315,209		0.9	%
Money market checking	326,367		2.5	%	290,610		4.3	%	254,492		4.2	%
Savings	334,266		0.8	%	359,173		1.8	%	398,013		2.2	%
Time deposits
Less than $100,000	368,943		4.1	%	393,708		4.7	%	381,062		4.2	%
$100,000 and greater	146,492		4.1	%	164,785		4.9	%	154,178		4.5	%
Total	$	1,621,207	2.1	%	$	1,660,270	2.9	%	$	1,655,377	2.7	%

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The following table sets forth by maturity time deposits $100,000 and greater at December 31 (dollars in thousands):

	2008
Within 3 months	$	26,882
After 3 months but within 6 months	19,256
After 6 months but within 12 months	32,528
After 1 year but within 5 years	65,774
Over 5 years	—
Total	$	144,440

Return on Equity and Assets and Other Financial Ratios

The following table sets forth selected financial ratios at and for the years ended December 31:

	2008		2007		2006
Return on average total assets	0.90	%	1.26	%	1.38	%
Return on average shareholders’ equity (GAAP) (1)	16.01	%	24.04	%	27.05	%
Return on average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation (non-GAAP) (1)	10.40	%	14.83	%	16.83	%
Cash dividends declared to net income	102.88	%	92.36	%	85.30	%
Average shareholders’ equity (GAAP) (1)	5.63	%	5.24	%	5.09	%
Average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation to average total assets (non-GAAP) (1)	8.67	%	8.49	%	8.18	%

(1)   See Note 7 to the Company’s consolidated financial statements and the section entitled “Non-GAAP Financial Measures” on page 37 of West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto). This presentation is consistent with the Company’s belief that it is unlikely that the Company would be required to satisfy the contingent repurchase obligation.

ITEM 1A.     RISK FACTORS

In addition to the other information in this Annual Report on Form 10-K, shareholders, prospective investors and other interested parties should carefully consider the following risk factors:

A continued downturn in the economy, particularly in the western suburbs of Chicago, Illinois, where the Company’s business is primarily conducted, could have a material adverse affect on the Company’s business, financial condition and results of operations.

The Company’s business and earnings are directly affected by general business and economic conditions in the U.S. and, in particular, economic conditions in the western suburbs of Chicago, Illinois. These conditions include legislative and regulatory changes, short-term and long-term interest rates, inflation, and changes in government monetary and fiscal policies, all of which are beyond our control.

At the end of 2007, the U.S. economy experienced a downturn that has continued into 2009. A continued downturn in economic conditions, in particular within the Company’s primary market area within the western suburbs of Chicago, Illinois, could result in a decrease in the demand for the Company’s products and services, an increase in the Company’s loan delinquencies and defaults, and an increase in the Company’s problem assets and foreclosures. The value of real estate pledged as collateral for loans made by the Company has declined, and may continue to decline, in turn reducing customers’ borrowing power, and reducing the value of assets and collateral securing the Company’s existing loans. These factors could lead to reduced interest income and an increase in the provision for loan losses.

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If current economic conditions continue or worsen, the Company’s business, growth and profitability are likely to suffer a material adverse effect. To the extent that the Company’s business customers’ underlying businesses are harmed as a result of the general economic environment, the Company’s customers are more likely to default on their loans. Negative economic trends could lead to higher past due and non-accrual loans, resulting in a material adverse effect to the Company’s financial condition and results of operations.

A further deterioration of the Company’s current non-performing loans or an increase in the number of non-performing loans may have a material adverse affect on the Company’s financial condition and results of operations.

Weakening economic conditions in the residential and commercial real estate sectors have adversely affected, and may continue to adversely affect, the Company’s loan portfolio. The Company’s ratio of non-performing assets to total assets increased in 2008 to 1.6% at December 31, 2008, from 0.2% at December 31, 2007. If loans that currently are non-performing further deteriorate or loans that are currently performing become non-performing loans, the Company may need to increase its allowance for loan losses. Such an increase may have a material adverse effect to the Company’s financial condition and results of operations.

The Company must effectively manage its credit risk.

There are risks inherent in making any loan, including risks inherent in dealing with individual borrowers, risks of nonpayment, risks resulting from uncertainties as to the future value of collateral and risks resulting from changes in economic and industry conditions. The Company attempts to minimize its credit risk through prudent loan application approval procedures, careful monitoring of the concentration of its loans within specific industries and periodic independent reviews of outstanding loans by its credit review department. However, the Company cannot ensure that its approval and monitoring procedures effectively manage its credit risks. Should the economic climate continue to worsen, borrowers may experience difficulty, and the level of non-performing loans, charge-offs, and delinquencies could rise and require further increases in the allowance for loan losses which could have a material adverse effect on the Company’s business, financial condition and results of operations.

The Company’s allowance for loan losses may prove to be insufficient to absorb probable incurred credit losses.

The Company’s estimate of the level of allowance for loan losses requires management to apply significant judgment. The Company establishes its allowance for loan losses in consultation with management and maintains it at a level considered adequate by management to absorb probable incurred credit losses in the loan portfolio. The amount of future loan losses is susceptible to changes in economic, operating and other conditions, including changes in interest rates, which may be beyond the Company’s control, and such losses may exceed current estimates. At December 31, 2008, the Company’s allowance for loan losses as a percentage of total loans was 1.25% and as a percentage of total nonperforming loans was approximately 62%. Although management believes that the allowance for loan losses is adequate to absorb probable incurred credit losses in the Company’s loan portfolio, the Company cannot predict loan losses with certainty, and the Company cannot assure you that its allowance for loan losses will prove sufficient to cover actual loan losses. Loan losses in excess of its allowance for loan losses may adversely affect the Company’s financial condition and results of operations.

The Company’s business is concentrated in, and dependent upon the continued growth and prosperity of, the western suburbs of Chicago.

The Company and its operating subsidiaries operate primarily in the western suburbs of Chicago, and as a result, the Company’s business, financial condition and results of operations are subject to changes in the economic conditions in this area. The Company has developed a strong presence in the counties it serves, with particular concentration in DuPage County, and surrounding counties. Based upon the 2000 census, these counties together represent a market of more than 1.8 million people. The Company’s success depends upon the business activity, population, income levels, deposits and real estate activity in this market. Although the Company’s customers’ business and financial interests may extend well beyond its market area, adverse economic conditions that affect its specific market area could reduce the Company’s growth rate, affect the ability of its customers to repay their loans and generally affect the Company’s business, financial condition and results of operations. Because of this geographic concentration, the

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Company is less able to diversify its credit risks across multiple markets than other regional or national financial institutions.

The value of certain investment securities is volatile and future declines or other-than-temporary impairments could materially adversely affect our financial condition and results of operations.

The Company’s securities portfolio includes corporate securities, pooled trust preferred securities issued by banks and insurance companies, U.S. government sponsored entity issued securities, mortgage-backed securities issued by U.S. government sponsored entities, municipal securities issued by states and political subdivisions and restricted stock issued by the Federal Home Loan Bank of Chicago.  Continued volatility in the market value for certain of the Company’s investment securities, whether caused by changes in market perceptions of credit risk, as reflected in the expected market yield of the security, or actual defaults in the portfolio could result in significant fluctuations in the value of the securities.  This could have a material adverse impact on the Company’s accumulated other comprehensive loss and shareholders’ equity depending on the direction of the fluctuations.  Furthermore, future downgrades or defaults in these securities could result in future classifications as other than temporarily impaired.  The Company evaluates all of its securities for other-than-temporary impairment on a regular basis.  In light of the recent conditions of the banking and insurance industries, the pooled trust preferred securities sector has been highly scrutinized.  As of December 31, 2008, the Company determined that the decline in the value of its pooled trust preferred securities does not represent other-than-temporary impairment.  No assurances can be provided, however, that the Company’s investment securities, including the pooled trust preferred securities, will not experience an other-than-temporary impairment, which could have a material adverse effect on the Company’s financial condition and results of operations.

The Company faces intense competition in all aspects of its business from other banks and financial institutions.

The banking and financial services business in its market is highly competitive. The Company’s competitors include large regional banks, local community banks, savings and loan associations, securities and brokerage companies, mortgage companies, insurance companies, finance companies, money market mutual funds, credit unions and other non-bank financial service providers. Increased competition in the Company’s market may result in a decrease in the amounts of its loans and deposits, reduced spreads between loan rates and deposit rates or loan terms that are more favorable to the borrower. Any of these results could have a material adverse effect on the Company’s ability to grow and remain profitable. If increased competition causes the Company to significantly discount the interest rates it offers on loans or increase the amount it pays on deposits, net interest income could be adversely impacted. If increased competition causes the Company to modify its underwriting standards, it could be exposed to higher losses from lending activities. Additionally, many of the Company’s competitors are much larger in total assets and capitalization, have greater access to capital markets and offer a broader range of financial services than the Company can offer.

Interest rates and other conditions impact the Company’s results of operations.

The Company’s profitability is in part a function of the spread between the interest rates earned on investments and loans and the interest rates paid on deposits and other interest-bearing liabilities. Like most banking institutions, the Company’s net interest spread and margin will be affected by general economic conditions and other factors, including fiscal and monetary policies of the federal government, that influence market interest rates and its ability to respond to changes in those rates. At any given time, the Company’s assets and liabilities will be such that they are affected differently by a given change in interest rates. As a result, an increase or decrease in rates, the length of loan terms or the mix of adjustable and fixed rate loans in the Company’s portfolio could have a positive or negative effect on its net income, capital and liquidity. The Company measures interest rate risk under various rate scenarios and using specific criteria and assumptions. A summary of this process, along with the results of the Company’s net interest income simulations is presented at “Quantitative and Qualitative Disclosures About Market Risk” included under Item 7A of Part II of this Form 10-K. Although management believes the Company’s current level of interest rate sensitivity is reasonable and effectively managed, significant fluctuations in interest rates may have an adverse effect on the Company’s business, financial condition and results of operations.

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The Company’s loan portfolio has a significant concentration of real estate loans, which are exposed to weaknesses in the U.S. and local housing markets and overall state of the economy.

Real estate lending (including home equity, commercial, construction and residential) is a large portion of the Company’s loan portfolio. These categories represent $925.9 million, or approximately 74.1% of the Company’s total loan portfolio as of December 31, 2008. The market value of real estate can fluctuate significantly in a short period of time as a result of market conditions in the geographic area in which the real estate is located, and adverse developments affecting real estate values in one or more of the Company’s markets could increase the credit risk associated with its loan portfolio. Additionally, construction and commercial real estate lending typically involves higher loan principal amounts and the repayment of the loans generally is dependent, in large part, on sufficient income from the properties securing the loans to cover operating expenses and debt service. Economic events or governmental regulations outside of the control of the borrower or the Company may negatively impact the future cash flow and market values of the affected properties.

If the loans that are collateralized by real estate become troubled during a time when market conditions are declining or have declined, then the Company may not be able to realize the amount of security that it anticipated at the time of originating the loan, which could cause the Company to increase its provision for loan losses and adversely affect its business, financial condition and results of operations. The ongoing weakness in the U.S. and local housing markets and the overall economy has lead to declines in home prices in many markets. Continued declines in real estate values, home sales volumes and financial stress on borrowers as a result of job losses, interest rate resets on adjustable rate mortgage loans or other factors could have continued adverse effects on borrowers that result in higher delinquencies and greater charge-offs in future periods, which could adversely affect the Company’s business, financial condition and results of operations.

The Company’s construction loans are based upon estimates of costs and value associated with the completed project. These estimates may be inaccurate, and the Company may be exposed to more losses on these construction loans than on other loans.

At December 31, 2008, construction loans, including land acquisition and development, totaled $161.5 million, or 12.9%, of the Company’s total loan portfolio. Construction and land acquisition and development lending involve additional risks because funds are advanced based upon values associated with the completed project, which are uncertain. Because of the uncertainties inherent in evaluating the construction cost estimates that the Company receives from its customers and other third parties, as well as the market value of the completed project and the effects of governmental regulation of real property, it is relatively difficult to evaluate accurately the total funds required to complete a project and the related loan-to-value ratio. As a result, construction loans often involve the disbursement of substantial funds with repayment dependent, in part, on the success of the ultimate project and the ability of the borrower to sell or lease the property, rather than the ability of the borrower or guarantor to repay principal and interest. The market values of real estate throughout the U.S., including in the Company’s market area, dramatically declined in 2008. The ongoing weakness in the U.S. real estate markets may negatively impact the ability of the Company’s borrowers to sell or lease their properties. If the Company’s appraisal of the anticipated value of the completed project proves to be overstated, the Company may have inadequate security for the loan.

Commercial loans also make up a significant portion of the Company’s loan portfolio.

Commercial loans were approximately $288.2 million (excluding $277.0 million of commercial real estate loans), or approximately 23.1% of the Company’s total loan portfolio as of December 31, 2008. The Company’s commercial loans are primarily made based on the identified cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. Most often, this collateral is accounts receivable, inventory, equipment or real estate. Credit support provided by the borrower for most of these loans and the probability of repayment is based on the liquidation of the pledged collateral and enforcement of a personal guarantee, if a guarantee is obtained. As a result, in the case of loans secured by accounts receivable, the availability of funds for the repayment of these loans may be substantially dependent on the ability of the borrower to collect amounts due from its customers. The collateral securing these loans may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the business. A continued decline in the U.S. economy could harm the businesses of the Company’s borrowers and reduce the value of the assets securing the Company’s commercial loans.

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The Company may experience difficulties in managing its growth, and its growth strategy involves risks that may negatively impact net income.

The Company has pursued and continues to pursue an internal growth strategy, the success of which will depend primarily upon generating an increasing level of loans and deposits at acceptable risk levels without corresponding increases in non-interest expenses. The Company’s growth strategy has been to operate out of a number of branches. The Company may establish other new branches and product areas, expand into new markets or make strategic acquisitions of other financial institutions, which may require significant upfront investments in technology, personnel and site locations. There can be no assurance that the Company will be successful in continuing its growth strategy and in continuing to improve or maintain its net income by leveraging its non-interest expenses.

The Company may expand into additional communities or attempt to strengthen its position in its current markets by undertaking additional branch openings. The Company currently anticipates opening one new branch in Will County during 2009. Based on experience, management believes that it generally takes up to two years for new banking facilities to first achieve operational profitability, due to the impact of overhead expenses and the start-up phase of generating loans and deposits. To the extent that the Company undertakes additional branching, it is likely to continue to experience the effects of higher operating expenses relative to operating income from the new operations, which may have an adverse effect on the Company’s levels of reported net income, return on average equity and return on average assets.

The Company may also acquire banks and related businesses that management believes provide a strategic fit with the Company’s business. To the extent that the Company grows through acquisitions, it may not be able to adequately and profitably manage this growth. Acquiring other banks and businesses will involve similar risks to those commonly associated with branching, but may also involve additional risks, including:

·potential exposure to unknown or contingent liabilities of banks and businesses the Company acquires;

·exposure to potential asset quality issues of the acquired bank or related business;

·difficulty and expense of integration the operation and personnel of banks and businesses the Company acquires; and

·the possible loss of key employees and customers of the banks and businesses the Company acquires.

The Company may need to raise additional capital in the future, but that capital may not be available when it is needed.

The Company is required by federal and state regulatory authorities to maintain adequate levels of capital to support its operations. The Company anticipates that its existing capital resources will satisfy its capital requirements for the foreseeable future. However, the Company may at some point need to raise additional capital to support continued growth, both internally and through acquisitions. The Company has applied to participate in the U.S. Department of the Treasury’s Capital Purchase Program, but as of the date of this report, the Company’s application has not been approved, and there is no guarantee that it will be approved.

The Company’s ability to raise additional capital, if needed, will depend on conditions in the capital markets at that time, which are outside its control, and on its financial performance. Accordingly, the Company cannot assure you of its ability to raise additional capital, if needed, on terms acceptable to the Company. If the Company cannot raise additional capital when needed, its ability to further expand its operations through internal growth and acquisitions could be materially impaired.

The Company’s community banking strategy relies heavily on its management team, and the unexpected loss of key managers may adversely affect its operations.

Much of the Company’s success to date has been influenced strongly by its ability to attract and to retain senior management experienced in banking and financial services and familiar with the communities in its market area. The Company’s ability to retain executive officers, the current management teams and loan officers of its operating

22

subsidiaries will continue to be important to the successful implementation of its strategy. It is also critical, as the Company grows, to be able to attract and retain qualified additional management and loan officers with the appropriate level of experience and knowledge about its market area to implement its community-based operating strategy. The unexpected loss of services of any key management personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on the Company’s business, financial condition and results of operations.

The Company and its subsidiaries are subject to examination and challenges by taxing authorities, and the Company’s effective tax rates may be adversely affected by changes in federal and state tax laws.

The Company’s effective tax rates may be adversely affected by changes in federal or state tax laws, regulations and agency interpretations. Tax laws are complex and subject to different interpretations by the taxpayer and the various taxing authorities. Management makes certain judgments and estimates about the application of these inherently complex laws when determining the provision for income taxes. Federal and state taxing authorities have recently become increasingly aggressive in challenging tax positions taken by financial institutions, including positions that may be taken by the Company. During the preparation of the Company’s tax returns, management makes reasonable interpretations of the tax laws which are subject to challenge upon audit by the tax authorities. These interpretations are also subject to reinterpretation based on management’s ongoing assessment of facts and evolving case law.

A recent change in Illinois law may adversely affect the Company’s operating results and financial condition. Under current tax law, the Company enjoys favorable tax treatment with respect to dividends it receives from its captive real estate investment trust, or REIT. Effective January 1, 2009, a new Illinois law relating to the deductibility of REIT dividends eliminated this tax benefit and the Company’s effective tax rate will likely increase.

Government regulation can result in limitations on the Company’s operations.

The Company and its operating subsidiaries operate in a highly regulated environment and are subject to supervision and regulation by a number of governmental regulatory agencies, including the Federal Reserve, the FDIC and the DFPR. Regulations adopted by these agencies, which are generally intended to provide protection for depositors and customers rather than for the benefit of shareholders, govern a comprehensive range of matters relating to ownership and control of the Company’s shares, its acquisition of other companies and businesses, permissible activities in which the Company may engage, maintenance of adequate capital levels and other aspects of the Company’s operations. These bank regulators possess broad authority to prevent or remedy unsafe or unsound practices or violations of law. The laws and regulations applicable to the banking industry could change at any time, and the Company cannot predict the effects of these changes on its business and profitability. Increased regulation could increase the Company’s cost of compliance and adversely affect profitability. For example, new legislation or regulation may limit the manner in which the Company may conduct its business, including its ability to offer new products, obtain financing, attract deposits, make loans and achieve satisfactory interest spreads.

As a financial institution, the Company is required under the USA PATRIOT Act and the BSA to develop programs to prevent the Company from being used for money laundering and terrorist activities. The Company is also obligated to file suspicious activity reports with the U.S. Treasury’s Office of Financial Crimes Enforcement Network in certain circumstances. These rules also require financial institutions to establish procedures for identifying and verifying the identity of customers seeking to open new financial accounts. On December 3, 2008, the Bank entered into an Order to Cease and Desist with the FDIC and the DFPR which requires the Bank to take certain corrective actions aimed at resolving any outstanding violations of BSA-related laws or regulations and to implement a revised BSA/AML Program designed to ensure compliance with these BSA-related laws and regulations. Although the Order does not relate to the Bank’s asset quality, capital position or the safety and soundness of its financial operations, the Order requires the Bank to, among other things, assess its BSA Department staffing needs, provide for independent testing of BSA/AML Program compliance, conduct a review of certain historical deposit and transaction and submit periodic reports of progress to the FDIC and DFPR. As a result, the Company expects the Order to increase the Company’s cost of regulatory compliance, which may adversely affect its earnings. In addition, if the Bank fails to comply with the Order, the failure could result in further regulatory actions, which may significantly limit the Company’s operations and growth.

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The Company’s potential participation in the U.S. Treasury’s Capital Purchase Program may adversely affect the value of its common stock and the rights of the Company’s common shareholders.

If the Company participates in the U.S. Treasury’s Capital Purchase Program, the terms of the preferred stock the Company may issue under the program could reduce investment returns to the Company’s common shareholders by restricting dividends and restricting capital management practices. Without the prior consent of the U.S. Treasury, the Company will be prohibited from increasing common stock dividends for the first three years while the U.S. Treasury holds the preferred stock.

Also, the preferred stock requires quarterly dividends to be paid at the rate of 5% per annum for the first five years and 9% per annum thereafter until the stock is redeemed by the Company. The payments of these dividends will decrease the excess cash the Company would otherwise have available to pay dividends on its common stock and to use for general corporate purposes, including working capital.

Finally, the Company will be prohibited from continuing to pay dividends on its common stock unless it has fully paid all required dividends on the preferred stock issued to the U.S. Treasury. Although the Company expects to be able to pay all required dividends on the preferred stock (and to continue to pay dividends on common stock at current levels), there is no guarantee that the Company will be able to do so in the future.

The Company has a continuing need for technological change, and it may not have the resources to effectively implement new technology.

The financial services industry continues to undergo rapid technological changes with frequent introductions of new technology-driven products and services. In addition to better serving customers, the effective use of technology increases efficiency and enables financial institutions to reduce costs. The Company’s future success will depend in part upon its ability to address the needs of its customers by using technology to provide products and services that will satisfy customer demands for convenience as well as to create additional efficiencies in its operations as it continues to grow and expand its market area. Many of the Company’s larger competitors have substantially greater resources to invest in technological improvements. As a result, they may be able to offer additional or superior products to those that the Company will be able to offer, which would put it at a competitive disadvantage. Accordingly, the Company cannot provide you with assurance that it will be able to effectively implement new technology-driven products and services or be successful in marketing such products and services to its customers.

Changes in accounting standards could impact the Company’s results of operations.

The accounting standard setters, including the Financial Accounting Standards Board, the Securities and Exchange Commission and other regulatory bodies, periodically change the financial accounting and reporting standards that govern the preparation of the Company’s consolidated financial statements. These changes can be hard to predict and can materially impact how the Company records and reports its financial condition and results of operations. In some cases, the Company could be required to apply a new or revised standard retroactively, resulting in the restatement of prior period financial statements.

The Company’s ability to pay dividends on its common stock is limited by law.

West Suburban’s ability to pay dividends on its common stock largely depends on its receipt of dividends from the Bank. The amount of dividends that the Bank may pay to West Suburban is limited by federal and state laws and regulations relating to financial institutions. As of December 31, 2008, approximately $15.1 million was available to be distributed as dividends by the Bank to West Suburban while remaining a “well-capitalized” institution. However, the FDIC may restrict the payment of dividends by the Bank. In addition, West Suburban and the Bank may decide to limit the payment of dividends even when they have the legal ability to pay them in order to retain earnings for use in their businesses.

In addition, if the Company participates in the U.S. Treasury’s Capital Purchase Program, the Company’s ability to pay dividends will be restricted as described in more detail under the Risk Factor entitled “The Company’s potential participation in the U.S. Treasury’s Capital Purchase Program may adversely affect the value of its common stock and the rights of the Company’s common shareholders.”

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There is no established trading market for West Suburban’s common shares.

West Suburban’scommon stock is not traded on any exchange or quoted on the NASDAQ or traded on any other established trading market, and West Suburbandoes not intend to apply for listing or quotation. West Suburban cannot assure you that a liquid market will develop for West Suburban’s common stock. If no trading market develops for West Suburban’s common stock, it may be difficult to sell your shares or, if sold, it may be difficult to resell the shares for a price at or above the price you paid for your shares. Even if a trading market is established, there is no assurance that such a trading market can be sustained.

System failure or breaches of the Company’s network security could subject the Company to increased operating costs as well as litigation and other liabilities.

The information technology systems and network infrastructure the Company uses could be vulnerable to unforeseen problems. The Company’s operations are dependent upon its ability to protect its information technology equipment against damage from physical theft, fire, power loss, telecommunications failure or a similar catastrophic event, as well as from security breaches, denial of service attacks, viruses, worms and other disruptive problems caused by hackers. Any damage or failure that causes an interruption in the Company’s operations could have a material adverse effect on its business, financial condition and results of operations. System break-ins, phishing and other disruptions could also jeopardize the security of information stored in and transmitted through the Company’s information technology systems and network infrastructure, which may result in significant liability to the Company and may cause existing and potential customers to refrain from doing business with it. Although the Company, with the help of third-party service providers, intends to continue to implement security technology and establish operational procedures to prevent such damage, there can be no assurance that these security measures will be successful. In addition, advances in information technology capabilities, new discoveries in the field of cryptography or other developments could result in a compromise or breach of the algorithms the Company and its third-party service providers use to encrypt and protect customer transaction data. A failure of such security measures could have a material adverse effect on the Company’s business, financial condition and results of operations.

The Company is subject to certain operational risks, including customer or employee fraud and data processing system failures and errors.

Employee errors and misconduct could subject the Company to financial losses or regulatory sanctions and seriously harm its reputation. Misconduct by the Company’s employees could include hiding unauthorized activities from the Company, improper or unauthorized activities on behalf of its customers or improper use of confidential information. It is not always possible to prevent employee errors and misconduct, and the precautions the Company takes to prevent and detect this activity may not be effective in all cases. Employee errors could also subject the Company to financial claims for negligence. The Company maintains a system of internal controls and insurance coverage to mitigate against operational risks, including data processing system failures and errors and customer or employee fraud. Should the Company’s internal controls fail to prevent or detect an occurrence, and if any resulting loss is not insured or exceeds applicable insurance limits, such failure could have a material adverse effect on the Company’s business, financial condition and results of operations.

ITEM 1B.     UNRESOLVED STAFF COMMENTS

None.

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ITEM 2.        PROPERTIES

West Suburban and the Bank occupy a total of approximately 264,300 square feet in 34 full-service branches, five limited-service branches and five departments providing insurance, financial and other services. West Suburban’s principal office is located in approximately 32,500 square feet of office space at 711 South Meyers Road, Lombard, Illinois. As indicated below, the Bank also operates its principal office as a branch. West Suburban Bank Land Trust, West Suburban Financial Services and WSIS are located at 711 South Meyers Road. West Suburban Bank VISA is located at 701 South Meyers Road. The Prepaid Solutions Group’s principal office is located at 8001 South Cass Avenue.

The following table sets forth certain information concerning the branches of the Bank as of December 31, 2008:

Location of Branches and Other Services	Approximate Square Feet	Status
711 South Meyers Road Lombard, Illinois	32,500	Owned
40 East St. Charles Road Villa Park, Illinois	2,700	Owned
17W754 22nd Street Oakbrook Terrace, Illinois	6,100	Owned
707 North Main Street Lombard, Illinois	4,100	Owned
221 South West Street Wheaton, Illinois	800	Owned
895 East Geneva Road Carol Stream, Illinois	3,000	Leased
1104 West Boughton Road Bolingbrook, Illinois	4,500	Owned
295 West Loop Road Wheaton, Illinois	4,500	Owned
6400 South Cass Avenue Westmont, Illinois	3,100	Leased
2800 Finley Road Downers Grove, Illinois	10,700	Owned
1122 South Main Street Lombard, Illinois	6,400	Owned
3S041 Route 59 Warrenville, Illinois	3,700	Owned
5330 Main Street Downers Grove, Illinois	10,500	Owned
8001 South Cass Avenue Darien, Illinois	17,800	Owned
672 East Boughton Road Bolingbrook, Illinois	7,100	Owned

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Location of Branches and Other Services	Approximate Square Feet	Status
1005 75th Street Darien, Illinois	1,000	Owned
505 North Weber Road Romeoville, Illinois	4,400	Owned
401 North Gary Avenue Carol Stream, Illinois	6,400	Owned
355 West Army Trail Road Bloomingdale, Illinois	10,700	Owned
1657 Bloomingdale Road Glendale Heights, Illinois	4,100	Owned
1061 West Stearns Road Bartlett, Illinois	3,400	Owned
1380 West Army Trail Road Carol Stream, Illinois	2,300	Leased
315 South Randall Road St. Charles, Illinois	1,400	Owned
3000 East Main Street St. Charles, Illinois	4,200	Owned
1870 McDonald Road South Elgin, Illinois	4,600	Owned
101 North Lake Street Aurora, Illinois	19,000	Owned
1830 Douglas Road Montgomery, Illinois	2,500	Owned
2000 West Galena Boulevard Aurora, Illinois	48,000	Owned
335 North Eola Road Aurora, Illinois	4,200	Owned
2830 Route 34 Oswego, Illinois	4,800	Owned
10 Saravanos Drive Yorkville, Illinois	3,200	Leased
1071 Station Drive Oswego, Illinois	3,200	Leased
1296 East Chicago Avenue Naperville, Illinois	2,300	Owned
2020 Feldott Lane Naperville, Illinois	4,500	Owned

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Location of Branches and Other Services	Approximate Square Feet	Status
Beacon Hill Retirement Community 2400 South Finley Road Lombard, Illinois	100	Leased
Clare Oaks 825 Carillon Drive Bartlett, Illinois	100	Leased
717 South Meyers Road Lombard, Illinois	7,100	Owned
701 South Meyers Road Lombard, Illinois	5,200	Owned
Lexington Health Care Center of Elmhurst 400 West Butterfield Road Elmhurst, Illinois	100	Leased
Lexington Health Care Center of Lombard 555 Foxworth Boulevard Lombard, Illinois	100	Leased

ITEM 3. LEGAL PROCEEDINGS

There are no material pending legal proceedings to which West Suburban or the Bank is a party other than routine litigation incidental to their respective businesses.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

West Suburban’s authorized and outstanding equity securities consist of common stock, no par value.

West Suburban hereby incorporates by reference the information called for by Item 5 of this Form 10-K from the sections entitled “Common Stock, Book Value and Dividends” and “Stock Performance Presentation” on page 4 and page 34, respectively, of West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto). The Company’s ability to pay dividends to shareholders is largely dependent upon dividends it receives from the Bank, which is subject to regulatory limitations on the amount of cash dividends it may pay. See “Business — Supervision and Regulation — The Company — Dividend Payments” and “Business — Supervision and Regulation — The Bank — Dividend Payments” for a more detailed description of theses limitations.

West Suburban’s common stock is not traded on any national or regional exchange. While there is no established trading market for West Suburban’s common stock, West Suburban is aware that from time to time limited or infrequent quotations are made with respect to West Suburban’s common stock and that there occurs limited trading in West Suburban’s common stock resulting from private transactions not involving brokers or dealers. Transactions in West Suburban’s common stock have been infrequent. As of March 4, 2009, West Suburban had 430,011 shares of common stock outstanding held by 1,148 shareholders of record. Management is aware of 43 transactions during

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2008 involving the sale, in the aggregate, of 3,846 shares of West Suburban’s common stock, and 22 transactions during 2007 involving the sale, in the aggregate, of 1,084 shares of West Suburban’s common stock. The average sale price of transactions in 2008 and 2007 was $635.27 and $702.87 per share of common stock, respectively.

ITEM 6. SELECTED FINANCIAL DATA

West Suburban hereby incorporates by reference the information called for by Item 6 of this Form 10-K from the section entitled “Selected Financial Data” on page 36 of West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto).

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

West Suburban hereby incorporates by reference the information called for by Item 7 of this Form 10-K from the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 39 through 49 of West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto).

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

West Suburban hereby incorporates by reference the information called for by Item 7A of this Form 10-K from the “Interest Rate Sensitivity” section included in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 39 through 49 of West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto).

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

West Suburban hereby incorporates by reference the information called for by Item 8 of this Form 10-K from the Consolidated Financial Statements and Notes to Consolidated Financial Statements on pages 7 through 33 of West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto).

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

An evaluation was performed under the supervision and with the participation of the Company’s management, including the Chairman and Chief Executive Officer and the President and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Exchange Act as of December 31, 2008. Based on that evaluation, the Company’s Chairman and Chief Executive Officer and the President and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified.

There have been no significant changes in the Company’s internal control over financial reporting that have affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

West Suburban’s management report on internal control over financial reporting is set forth in, and West Suburban hereby incorporates by reference, the section entitled “Management’s Report on Internal Control over Financial Reporting” on page 5 of West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto).

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ITEM 9B.OTHER INFORMATION

None.

PART III

ITEM 10.     DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

In addition, and as a supplement to the information provided under the caption “Executive Officers of West Suburban” in Part I of this Form 10-K, West Suburban hereby incorporates by reference the information called for by Item 10 of this Form 10-K regarding directors of West Suburban from the section entitled “Election of Directors” of West Suburban’s 2009 Proxy Statement.

Section 16(a) of the Exchange Act requires that the Company’s executive officers and directors and persons who own more than 10% of the Company’s Common Stock file reports of ownership and changes in ownership with the Securities and Exchange Commission and with the exchange on which West Suburban’s Common Stock is traded. Such persons are also required to furnish the Company with copies of all Section 16(a) forms they file. Based solely on the Company’s review of the copies and forms furnished to the Company and, if appropriate, representations made to the Company by any such reporting person concerning whether a Form 5 was required to be filed for the 2008 fiscal year, the Company is not aware that any of its directors and executive officers or 10% shareholders failed to comply with the filing requirements of Section 16(a) during 2008.

West Suburban adopted a code of ethics that applies to West Suburban’s principal executive officer, principal financial officer and principal accounting officer or controller, or persons performing similar functions. West Suburban’s code of ethics is available in the Shareholder Information section of West Suburban’s website, www.westsuburbanbank.com.

Since the date of West Suburban’s 2008 Proxy Statement, there have been no material changes to the procedures by which shareholders may recommend nominees to West Suburban’s board of directors.

ITEM 11. EXECUTIVE COMPENSATION

West Suburban hereby incorporates by reference the information called for by Item 11 of this Form 10-K from the section entitled “Executive Compensation” of West Suburban’s 2009 Proxy Statement; provided, however, that “Report of the Compensation Committee on Executive Compensation” is specifically not incorporated into this Form 10-K.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS

West Suburban hereby incorporates by reference the information called for by Item 12 of this Form 10-K from the sections entitled “Security Ownership of Certain Beneficial Owners” and “Security Ownership of Management” of West Suburban’s 2009 Proxy Statement.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

West Suburban hereby incorporates by reference the information called for by Item 13 of this Form 10-K from the section entitled “Transactions with Directors, Officers and Associates” and “Corporate Governance and the Board of Directors” of West Suburban’s 2009 Proxy Statement.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

West Suburban hereby incorporates by reference the information called for by Item 14 of this Form 10-K from the section entitled “Accounting Fees and Services” of West Suburban’s 2009 Proxy Statement.

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PART IV

ITEM 15.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES

Item (a)(1) and (2). Financial Statements

WEST SUBURBAN BANCORP, INC. AND SUBSIDIARIES

LIST OF FINANCIAL STATEMENTS AND

FINANCIAL STATEMENT SCHEDULES

The following audited Consolidated Financial Statements of West Suburban and its subsidiaries and related notes and report of independent registered public accounting firm are incorporated by reference from West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto).

	Annual Report Page No.
Report of Independent Registered Public Accounting Firm	6
Consolidated Balance Sheets — December 31, 2008 and 2007	7
Consolidated Statements of Income — Years Ended December 31, 2008, 2007 and 2006	8
Consolidated Statements of Changes in Shareholders’ Equity — Years Ended December 31, 2008, 2007 and 2006	9
Consolidated Statements of Cash Flows — Years Ended December 31, 2008, 2007 and 2006	10
Notes to Consolidated Financial Statements	11

The following Condensed Financial Information-Parent Only is incorporated by reference from Note 13 to West Suburban’s audited Consolidated Financial Statements as set forth in West Suburban’s Annual Report to Shareholders for the fiscal year ended December 31, 2008 (attached as Exhibit 13 hereto).

	Annual Report Page No.
Condensed Balance Sheets — December 31, 2008 and 2007	31
Condensed Statements of Income — Years Ended December 31, 2008, 2007 and 2006	32
Condensed Statements of Cash Flows — Years Ended December 31, 2008, 2007 and 2006	32

Schedules

Schedules other than those listed above are omitted for the reason that they are not required or are not applicable or the required information is included in the financial statements incorporated by reference or notes thereto.

31

Item 15(a)(3).         Exhibits

The exhibits required by Item 601 of Regulation S-K are included with this Form 10-K and are listed on the “Index to Exhibits” immediately following the signature page.

***

Upon written request to the President and Chief Financial Officer of West Suburban Bancorp, Inc., 2800 Finley Road, Downers Grove, Illinois, 60515, copies of the exhibits listed above are available to shareholders of West Suburban by specifically identifying each exhibit desired in the request.

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FORM 10-K SIGNATURE PAGE

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

WEST SUBURBAN BANCORP, INC.
(Registrant)
By	/s/ Duane G. Debs
	Duane G. Debs
	President and Chief Financial Officer

Date: March 11, 2009

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on the 11th day of March, 2009.

SIGNATURE			TITLE
/s/ Kevin J. Acker	3/11/2009	Chairman, Chief Executive Officer
Kevin J. Acker	Date	and Director
/s/ Duane G. Debs	3/11/2009	President, Chief Financial Officer,
Duane G. Debs	Date	Director and Principal Accounting
		Officer
/s/ David S. Bell	3/11/2009	Director
David S. Bell	Date
/s/ Peggy P. LoCicero	3/11/2009	Director
Peggy P. LoCicero	Date
/s/ Charles P. Howard	3/11/2009	Director
Charles P. Howard	Date

The foregoing includes all of the Board of Directors of West Suburban.

33

INDEX TO EXHIBITS

Exhibit Number	Description
3.1	Articles of Incorporation of West Suburban filed March 14, 1986 — Incorporated by reference from Exhibit 3.1 of Form 10-K of West Suburban dated March 21, 2003, under Commission File No. 0-17609.
3.2	Articles of Amendment to Articles of Incorporation of West Suburban filed November 2, 1988 — Incorporated by reference from Exhibit 3.2 of Form 10-K of West Suburban dated March 21, 2003, under Commission File No. 0-17609.
3.3	Articles of Amendment to Articles of Incorporation of West Suburban filed June 20, 1990 — Incorporated by reference from Exhibit 3.3 of Form 10-K of West Suburban dated March 21, 2003, under Commission File No. 0-17609.
3.4	Articles of Amendment to Articles of Incorporation of West Suburban filed June 8, 1998 — Incorporated by reference from Exhibit 3.4 of Form 10-K of West Suburban dated March 21, 2003, under Commission File No. 0-17609.
3.5	Articles of Amendment to Articles of Incorporation of West Suburban filed May 27, 2003 — Incorporated by reference from Exhibit 3.5 of Form 10-Q of West Suburban dated August 14, 2003, under Commission File No. 0-17609.
3.6	Amended and Restated By-laws of West Suburban — Incorporated by reference from Exhibit 3.5 of Form 10-K of West Suburban dated March 21, 2003, under Commission File No. 0-17609.
4.1	Specimen of Common Stock certificate — Incorporated by reference from Exhibit 4.1 of Form 10-K of West Suburban dated March 14, 2006, under Commission File No. 0-17609.
10.1	Directors and Senior Management Deferred Compensation Plan of West Suburban.
10.2	Restated Employment Agreement dated December 29, 2008 between West Suburban and Mr. Kevin J. Acker.
10.3	Restated Employment Agreement dated December 29, 2008 between West Suburban and Mr. Keith W. Acker.
10.4	Restated Employment Agreement dated December 29, 2008 between West Suburban and Mr. Duane G. Debs.
10.5	Restated Employment Agreement dated December 29, 2008 between West Suburban and Mr. Michael P. Brosnahan.
10.6	Restated Employment Agreement dated December 31, 2008 between West Suburban and Mr. Daniel P. Grotto.
10.7	Form of Amended and Restated Life Insurance Agreement between West Suburban and Messrs. Kevin J. Acker, Keith W. Acker, Duane G. Debs, Michael P. Brosnahan and Daniel P. Grotto.
13	Annual Report to Shareholders of West Suburban for fiscal year ended December 31, 2008.
21	Subsidiaries of Registrant.
31.1	Certification of Kevin J. Acker, Chairman and Chief Executive Officer, Pursuant to Rule 13a-14(a) and Rule 15d-14(a).
31.2	Certification of Duane G. Debs, President and Chief Financial Officer, Pursuant to Rule 13a-14(a) and Rule15d-14(a).
32.1	Certification of Kevin J. Acker, Chairman and Chief Executive Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

34

Exhibit Number	Description
32.2	Certification of Duane G. Debs, President and Chief Financial Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

35

EX-10.1

Exhibit 10.1

West Suburban Bancorp, Inc.

Directors and Senior Management Deferred Compensation Plan

Effective January 1, 2005,

as amended and restated

December 30, 2008

TABLE OF CONTENTS

		Page
Purpose		1
ARTICLE 1	Definitions	1
ARTICLE 2	Selection, Enrollment, Eligibility	7
2.1	Selection by Committee	7
2.2	Enrollment Requirements	7
2.3	Eligibility; Commencement of Participation	7
2.4	Termination of Participation and/or Deferrals	8
ARTICLE 3	Deferral Commitments/Set-Aside/Crediting/Taxes	8
3.1	Minimum Deferrals	8
3.2	Maximum Deferral	8
3.3	Election to Defer; Effect of Election Form	9
3.4	Withholding of Annual Deferral Amounts	9
3.5	Annual Set-Aside Amount	9
3.6	Investment of Trust Assets	9
3.7	Vesting	10
3.8	Crediting/Debiting of Account Balances	10
3.9	FICA and Other Taxes	12
ARTICLE 4	Specified Time Distribution; Unforeseeable Financial Emergencies; Early Withdrawal Election	12
4.1	Specified Time Distribution	12
4.2	Other Benefits Take Precedence Over Specified Date Distribution	12
4.3	Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies	13
ARTICLE 5	Distributions	14
5.1	Benefit Distribution Date	14
5.2	Limited Cashouts	14
5.3	Time of Distribution	14
5.4	Change to Election Forms	15
ARTICLE 6	Retirement Benefit	16
6.1	Retirement Benefit	16
6.2	Payment of Retirement Benefit	16
6.3	Death Prior to Completion of Retirement Benefit	16
ARTICLE 7	Pre-Retirement Survivor Benefit	17
7.1	Pre-Retirement Survivor Benefit	17

i

7.2	Payment of Pre-Retirement Survivor Benefit	17
ARTICLE 8	Termination Benefit	17
8.1	Termination Benefit	17
8.2	Payment of Termination Benefit	17
ARTICLE 9	Disability Benefit	17
9.1	Disability Benefit	17
9.2	Payment of Disability Benefit	17
ARTICLE 10	Beneficiary Designation	18
10.1	Beneficiary	18
10.2	Beneficiary Designation; Change; Spousal Consent	18
10.3	Acknowledgment	18
10.4	No Beneficiary Designation	18
10.5	Doubt as to Beneficiary	18
10.6	Discharge of Obligations	18
ARTICLE 11	Leave of Absence	19
11.1	Paid Leave of Absence	19
11.2	Unpaid Leave of Absence	19
11.3	Leaves Resulting in Termination of Employment	19
ARTICLE 12	Termination, Amendment or Modification	20
12.1	Termination	20
12.2	Amendment	20
12.3	Effect of Payment	21
ARTICLE 13	Administration	21
13.1	Committee Duties	21
13.2	Administration Upon Change In Control	21
13.3	Agents	22
13.4	Binding Effect of Decisions	22
13.5	Indemnity of Committee	22
13.6	Employer Information	22
ARTICLE 14	Other Benefits and Agreements	22
14.1	Coordination with Other Benefits	22
ARTICLE 15	Claims Procedures	23
15.1	Presentation of Claim	23
15.2	Notification of Decision	23
15.3	Review of a Denied Claim	24
15.4	Decision on Review	24

ii

15.5	Legal Action	25
ARTICLE 16	Trust	25
16.1	Establishment of the Trust	25
16.2	Interrelationship of the Plan and the Trust	25
16.3	Distributions From the Trust	25
ARTICLE 17	Miscellaneous	25
17.1	Status of Plan	25
17.2	Unsecured General Creditor	25
17.3	Employer’s Liability	26
17.4	Nonassignability	26
17.5	Not a Contract of Employment	26
17.6	Furnishing Information	26
17.7	Terms	26
17.8	Captions	26
17.9	Governing Law	26
17.10	Notice	27
17.11	Successors	27
17.12	Spouse’s Interest	27
17.13	Validity	27
17.14	Incompetent	27
17.15	Court Order	27
17.16	Distribution in the Event of Income Inclusion under Section 409A	28
17.17	Deduction Limitation on Benefit Payments	28
17.18	Insurance	28
17.19	Legal Fees To Enforce Rights After Change in Control	29

iii

WEST SUBURBAN BANCORP, INC.

DIRECTORS AND SENIOR MANAGEMENT

DEFERRED COMPENSATION PLAN

Effective January 1, 2005

as amended and restated

December 30, 2008

Purpose

The purpose of this Plan is to provide specified benefits to a select group of management or highly compensated Employees and Directors who contribute materially to the continued growth, development and future business success of West Suburban Bancorp, Inc., an Illinois corporation, and its subsidiaries, if any, that sponsor this Plan.  This Plan shall be unfunded for tax purposes and for purposes of Title I of ERISA.  This Plan is intended to be a non-qualified deferred compensation plan subject to Section 409A.  Participants were permitted to commence deferrals into the Plan effective January 1, 2005.  The Company also maintains the West Suburban Bancorp, Inc. Directors and Senior Management Deferred Compensation Plan under which all amounts deferred on or before December 31, 2004 are held.

This Plan was originally adopted effective January 1, 2005 and is hereby amended and restated in its entirety December 30, 2008.  This Plan is intended to comply with Section 409A in its entirety and has at all times since January 1, 2005 been operated in good faith compliance with Section 409A.  This Plan shall apply only with respect to amounts deferred or vested on or after January 1, 2005.

ARTICLE 1
Definitions

For the purposes of this Plan, unless otherwise clearly apparent from the context, the following phrases or terms shall have the following indicated meanings:

1.1“Account Balance” shall mean, with respect to a Participant, a credit on the records of the Employer equal to the sum of (i) the Deferral Account balance, and (ii) the Set-Aside Account balance.  The Account Balance, and each other specified account balance, shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant, or his or her designated Beneficiary, pursuant to this Plan.

1.2“Annual Bonus” shall mean any compensation, in addition to Base Annual Salary relating to services performed during any calendar year, whether or not paid in such calendar year or included on the Federal Income Tax Form W-2 for such calendar year, payable to a Participant as an Employee under any Employer’s annual bonus and cash incentive plans.

1.3“Annual Deferral Amount” shall mean that portion of a Participant’s Base Annual Salary, Annual Bonus and Director’s Fees that a Participant elects to have and is deferred in accordance with ARTICLE 3 for any one Plan Year.  In the event of a Participant’s Retirement, Disability, death or a Termination of Employment prior to the end of a Plan Year, such year’s Annual Deferral Amount shall be the actual amount withheld prior to such event.

1.4“Annual Installment Method” shall be an annual installment payment over the number of years selected by the Participant in accordance with this Plan, calculated as follows: the Account Balance of the Participant shall be calculated as of the close of business on the last business day of the Plan Year.  The annual installment shall be calculated by multiplying this balance by a fraction, the numerator of which is one and the denominator of which is the remaining number of annual payments due the Participant.  By way of example, if the Participant elects a ten (10) year Annual Installment Method, the first payment shall be 1/10 of the Account Balance, calculated as described in this definition.  The following year, the payment shall be 1/9 of the Account Balance, calculated as described in this definition.  Each annual installment shall be paid no later than sixty (60) days after the last business day of the applicable Plan Year.

1.5“Annual Set-Aside Amount” shall mean, for any one Plan Year, the amount determined in accordance with Section 3.5.

1.6“Base Annual Salary” shall mean the annual cash compensation relating to services performed during any calendar year, whether or not paid in such calendar year or included on the Federal Income Tax Form W-2 for such calendar year, excluding Annual Set-Aside Amounts, bonuses, commissions, overtime, fringe benefits, stock options, relocation expenses, incentive payments, non-monetary awards, director’s fees and other fees, and automobile and other allowances paid to a Participant for employment services rendered (whether or not such allowances are included in the Employee’s gross income). Base Annual Salary shall be calculated before reduction for compensation voluntarily deferred or contributed by the Participant pursuant to all qualified or non-qualified plans of any Employer and shall be calculated to include amounts not otherwise included in the Participant’s gross income under Code Sections 125, 402(e)(3), 402(h), or 403(b) pursuant to plans established by any Employer; provided, however, that all such amounts will be included in compensation only to the extent that had there been no such plan, the amount would have been payable in cash to the Employee.

1.7“Beneficiary” shall mean one or more persons, trusts, estates or other entities, designated in accordance with ARTICLE 10, that are entitled to receive benefits under this Plan upon the death of a Participant.

1.8“Beneficiary Designation Form” shall mean the form established from time to time by the Committee that a Participant completes, signs and returns to the Committee to designate one or more Beneficiaries.

2

1.9“Benefit Distribution Date” shall have the meaning set forth in Section 5.1.

1.10“Board” shall mean the board of directors of the Company.

1.11“Change in Control” shall mean the first to occur of any of the following events:

(a)The consummation of the acquisition by any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Company; or

(b)The individuals who, as of the date hereof, are members of the Board of the Company cease for any reason to constitute a majority of the Board, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of a majority of the Board, and such new director shall, for purposes of this Agreement, be considered as a member of the Board; or

(c)Consummation by the Company of:  (1) a merger or consolidation if the shareholders immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of the Company outstanding immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of the Company.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Company is acquired by:  (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the Company or an Employer; or (2) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders in the same proportion as their ownership of stock of the Company immediately prior to such acquisition.

1.12“Claimant” shall have the meaning set forth in Section 15.1.

1.13“Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time.

1.14“Committee” shall mean the committee described in ARTICLE 13.

3

1.15“Company” shall mean West Suburban Bancorp, Inc., an Illinois corporation, and any successor to all or substantially all of the Company’s assets or business.

1.16“Deferral Account” shall mean (i) the sum of all of a Participant’s Annual Deferral Amounts, plus (ii) amounts credited in accordance with all the applicable crediting and debiting provisions of this Plan that relate to the Participant’s Deferral Account, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to his or her Deferral Account.

1.17“Deferred Compensation and Split-Dollar Insurance Agreement” shall mean the Deferred Compensation and Split-Dollar Insurance Agreement previously executed by the Participant and the Employer which set forth the amount of compensation the Employer “set-aside” on that Participant’s behalf each year.

1.18“Director” shall mean any member of the board of directors of any Employer.

1.19“Director’s Fees” shall mean the annual fees paid by any Employer, including retainer fees and meetings fees, as compensation for serving on the board of directors.

1.20“Disability” shall mean that (i) the Participant is unable to engage in any substantial gainful activity by reason of 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, or (ii) the Participant is, by reason of 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, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company or an Employer.

1.21“Disability Benefit” shall mean the benefit set forth in ARTICLE 9.

1.22“Election Form” shall mean the form established from time to time by the Committee that a Participant completes, signs and returns to the Committee to make an election under the Plan.

1.23“Employee” shall mean a person who is an employee of any Employer.

1.24“Employer(s)” shall mean the Company and/or any of its subsidiaries (now in existence or hereafter formed or acquired) that have been selected by the Board to participate in the Plan and have adopted the Plan as a sponsor.

1.25“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as it may be amended from time to time.

1.26“First Plan Year” shall mean the period beginning January 1, 2005 and ending December 31, 2005.

4

1.27“Measurement Funds” shall mean the hypothetical investment fund or benchmark made available to Participants by the Committee for the purpose of valuing amounts contributed to the Plan.

1.28“Participant” shall mean any Employee or Director (i) who is selected to participate in the Plan, (ii) who elects to participate in the Plan, (iii) who signs a Participation Agreement, an Election Form and a Beneficiary Designation Form, (iv) whose signed Participation Agreement, Election Form and Beneficiary Designation Form are accepted by the Committee, (v) who commences participation in the Plan, and (vi) whose Participation Agreement has not terminated.  A spouse or former spouse of a Participant shall not be treated as a Participant in the Plan or have an account balance under the Plan, even if he or she has an interest in the Participant’s benefits under the Plan as a result of applicable law or property settlements resulting from legal separation or divorce.

1.29“Participation Agreement” shall mean a written agreement, as may be amended from time to time, which is entered into by and between an Employer and a Participant with respect to this Plan.  Each Participation Agreement executed by a Participant and the Participant’s Employer shall provide for the entire benefit to which such Participant is entitled under the Plan.  Should there be more than one Participation Agreement, the Participation Agreement bearing the latest date of acceptance by the Employer shall supersede all previous Participation Agreements in their entirety and shall govern such entitlement.  The terms of any Participation Agreement may be different for any Participant, and any Participation Agreement may provide additional benefits not set forth in the Plan or limit the benefits otherwise provided under the Plan; provided, however, that any such additional benefits or benefit limitations must be agreed to by both the Employer and the Participant.

1.30“Plan” shall mean the Company’s Directors and Senior Management Deferred Compensation Plan, which shall be evidenced by this instrument and by each Participation Agreement, as they may be amended from time to time.

1.31“Plan Year” shall, except for the First Plan Year, mean a period beginning on January 1 of each calendar year and continuing through December 31 of such calendar year.

1.32“Pre-Retirement Survivor Benefit” shall mean the benefit set forth in ARTICLE 7.

1.33“Retirement,” “Retire(s)” or “Retired” shall mean, with respect to an Employee, Termination of Employment from all Employers on or after the earlier of the attainment of age fifty (50); and shall mean with respect to a Director who is not an Employee, severance of his or her directorships with all Employers on or after the later of (a) the attainment of age seventy (70), or (b) in the sole discretion of the Committee, an age later than age seventy (70).  If a Participant is both an Employee and a Director, Retirement shall occur on the later of the date he or she Retires as an Employee or a Director.  Retirement, for purposes of the Plan, shall mean a “separation from service” as determined under Treas. Reg. Section 1.409A-1(h).

5

1.34“Retirement Benefit” shall mean the benefit set forth in ARTICLE 6.

1.35“Section 409A” shall mean Code Section 409A, related U.S. Treasury Department regulations and guidance promulgated thereunder, including such regulations and guidance promulgated after the effective date of the Plan, as deemed appropriate by the Committee.

1.36“Set-Aside Account” shall mean (i) the sum of the Participant’s Annual Set-Aside Amounts, plus (ii) amounts credited or debited in accordance with all the applicable crediting and debiting provisions of this Plan that relate to the Participant’s Set-Aside Account, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participant’s Set-Aside Account.

1.37“Specified Employee” shall mean, in the event the Company becomes publicly traded, any Participant who is a “key employee” (as defined in Code Section 416(i) without regard to paragraph (5) thereof), as determined by the Committee based upon the twelve (12)-month period ending on each December 31st (such 12-month period is referred to below as the “identification period”).  All Participants who are determined to be key employees under Code Section 416(i) (without regard to paragraph (5) thereof) during the identification period shall be treated as Specified Employees for purposes of the Plan during the twelve (12)-month period that begins on the April 1 following the close of such identification period.  For purposes of determining whether an individual is a key employee under Code Section 416(i), “compensation” shall mean such individual’s W-2 compensation as reported by the Company or any Employer for a particular calendar year.

1.38“Specified Time Distribution” shall mean the distribution set forth in Section 4.1.

1.39“Termination Benefit” shall mean the benefit set forth in ARTICLE 8.

1.40“Termination of Employment” shall mean the severing of the Participant’s employment with all Employers, or service as a Director of all Employers, voluntarily or involuntarily, for any reason other than Retirement, Disability, death or an authorized leave of absence; provided such severing of employment constitutes a “separation from service” as defined in Treas. Reg. Section 1.409A-1(h).  If a Participant is both an Employee and a Director, a Termination of Employment shall on the later of the date he or she terminates his or her employment with an Employer as an Employee or service as a Director of all Employers.

1.41“Trust” shall mean one or more trusts that may be established by the Company, in its sole discretion.

1.42“Unforeseeable Financial Emergency” shall mean a severe financial hardship of the Participant resulting from (i) an illness or accident of the Participant, the Participant’s spouse, the Participant’s Beneficiary or the Participant’s dependent (as defined in Code Section 152, without regard to paragraphs (b)(1), (b)(2) and (d)(1)(B) thereof), (ii) loss of

6

the Participant’s property due to casualty, or (iii) other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant.

ARTICLE 2
Selection, Enrollment, Eligibility

2.1Selection by Committee.  Participation in the Plan shall be limited to a select group of management and highly compensated Employees and Directors of the Employers, as determined by the Committee in its sole discretion.  From that group, the Committee shall select, in its sole discretion, Employees and Directors to participate in the Plan.

2.2Enrollment Requirements.

(a)As a condition to participation, each selected Employee or Director who is eligible to participate in the Plan effective as of the first day of a Plan Year, shall complete, execute and return to the Committee a Participation Agreement, an Election Form and a Beneficiary Designation Form, all prior to the first day of such Plan Year, or such earlier deadline as may be established by the Committee in its sole discretion.  In addition, the Committee shall establish from time to time such other enrollment requirements as it determines in its sole discretion are necessary.

(b)A selected Employee or Director who first becomes eligible to participate in this Plan after the first day of a Plan Year, and who is not otherwise prohibited from making an election under this subsection (b) by operation of the plan aggregation rules of Section 409A, must complete, execute and return to the Committee, as the Committee may deem necessary in its sole discretion, a Participation Agreement, an Election Form and a Beneficiary Designation Form within thirty (30) days after he or she first becomes eligible to participate in the Plan, or within such other earlier deadline as may be established by the Committee, in its sole discretion, in order to participate for that Plan Year.  In such event, such person’s participation in this Plan shall not commence earlier than the date determined by the Committee pursuant to Section 2.3 and such person shall not be permitted to defer under this Plan any portion of his or her Base Annual Salary, Annual Bonus or Director’s fees that are paid with respect to services performed prior to his or her participation commencement date, except to the extent permissible under Section 409A.

2.3Eligibility; Commencement of Participation.  Provided an Employee or Director selected to participate in the Plan has met all enrollment requirements set forth in this Plan and required by the Committee, including returning all required documents to the Committee within the specified time period, that Employee or Director shall commence participation in the Plan on the first day of the month following the month in which the Employee or Director completes all enrollment requirements.  If an Employee or a

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Director fails to meet all such requirements within the period required, in accordance with Section 2.2, that Employee or Director shall not be eligible to participate in the Plan until the first day of the Plan Year following the delivery to and acceptance by the Committee of the required documents.

2.4Termination of Participation and/or Deferrals.  If the Committee determines in good faith that a Participant no longer qualifies as a member of a select group of management or highly compensated employees, as membership in such group is determined in accordance with Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, to the extent permitted by Section 409A, the Committee shall have the right, in its sole discretion, to (i) terminate any deferral election the Participant has made for the remainder of the Plan Year in which the Participant’s membership status changes, (ii) prevent the Participant from making future deferral elections and/or (iii) take any other action permitted or required pursuant to Section 409A as and when the Committee deems appropriate or necessary.  Notwithstanding the foregoing, in the event of a termination of the Plan in accordance with Section 12.1, the termination of the affected Participant’s eligibility for participation in the Plan shall not be governed by this Section 2.4, but rather shall be governed by ARTICLE 12.  In the event that a Participant is no longer eligible to defer compensation under this Plan, the Participant’s Account Balance shall continue to be governed by the terms of this Plan until such time as the Participant’s Account Balance is paid in accordance with the terms of this Plan.

ARTICLE 3
Deferral Commitments/Set-Aside/Crediting/Taxes

3.1Minimum Deferrals.  For each Plan Year, a Participant may elect to defer, as his or her Annual Deferral Amount, Base Annual Salary, Annual Bonus and/or Director’s Fees in an aggregate minimum amount of $3,000.  If an election is made for less than $3,000, the amount deferred shall be zero.

3.2Maximum Deferral.

(a)Base Annual Salary, Annual Bonus and Director’s Fees.  For each Plan Year, a Participant may elect to defer, as his or her Annual Deferral Amount, Base Annual Salary, Annual Bonus and/or Director’s Fees up to the following maximum percentages for each deferral elected:

Deferral	Maximum Amount
Base Annual Salary	80	%
Annual Bonus	80	%
Director’s Fees	100	%

Notwithstanding the foregoing, if a Participant first becomes a Participant after the first day of a Plan Year, or in the case of the first Plan Year of the Plan itself, the maximum Annual Deferral Amount, with respect to Base Annual Salary,

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Annual Bonus and Directors Fees shall be limited to the amount of compensation not yet earned by the Participant as of the date the Participant submits a Participation Agreement and Election Form to the Committee for acceptance.

3.3Election to Defer; Effect of Election Form.

(a)First Plan Year.  In connection with a Participant’s commencement of participation in the Plan, the Participant shall make an irrevocable deferral election for the Plan Year in which the Participant commences participation in the Plan, along with such other elections as the Committee deems necessary or desirable under the Plan.  For these elections to be valid, the Election Form must be completed and signed by the Participant, timely delivered to the Committee (in accordance with Section 2.2) and accepted by the Committee.

(b)Subsequent Plan Years.  For each succeeding Plan Year, an irrevocable deferral election for that Plan Year, and such other elections as the Committee deems necessary or desirable under the Plan, shall be made by timely delivering to the Committee, in accordance with its rules and procedures, before the end of the Plan Year preceding the Plan Year for which the election is made, a new Election Form. If no such Election Form is timely delivered for a Plan Year, the Annual Deferral Amount shall be the same as that elected for the preceding Plan Year.

3.4Withholding of Annual Deferral Amounts.  For each Plan Year, the Base Annual Salary portion of the Annual Deferral Amount shall be withheld from each regularly scheduled Base Annual Salary payroll in equal amounts, as adjusted from time to time for increases and decreases in Base Annual Salary.  The Annual Bonus and/or Director’s Fees portion of the Annual Deferral Amount shall be withheld at the time the Annual Bonus or Director’s Fees are or otherwise would be paid to the Participant, whether or not this occurs during the Plan Year itself.

3.5Annual Set-Aside Amount.  The Employer may, in its sole discretion, credit a “set-aside” amount to a Participant’s Set-Aside Account under this Plan each month, which amounts shall be for that Participant the Annual Set-Aside Amount for that Plan Year; provided, however, that if a Participant has entered into an employment agreement with the Employer and that agreement requires the Employer to credit a particular “set-aside” amount on behalf of that Participant, the Employer must credit such amount to the Participant’s Set-Aside Account under this Plan.  The amount so credited to a Participant may be smaller or larger than the amount credited to any other Participant, and the amount credited to any Participant for a Plan Year may be zero, even though one or more other Participants receive an Annual Set-Aside Amount for that Plan Year.

3.6Investment of Trust Assets.  If the Company establishes a Trust, the Trustee of the Trust shall be authorized, upon written instructions received from the Committee or investment manager appointed by the Committee, to invest and reinvest the assets of the Trust in accordance with the applicable Trust Agreement, including the disposition of stock and

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reinvestment of the proceeds in one or more investment vehicles designated by the Committee.

3.7Vesting.  A Participant shall at all times be 100% vested in his or her Deferral Account and Set Aside Deferral Account.

3.8Crediting/Debiting of Account Balances.  In accordance with, and subject to, the rules and procedures that are established from time to time by the Committee, in its sole discretion, amounts shall be credited or debited to a Participant’s Account Balance in accordance with the following rules:

(a)Election of Measurement Funds.  A Participant, in connection with his or her initial deferral election in accordance with Section 3.3(a) above, shall elect, on the Election Form, one or more Measurement Fund(s) (as described in Section 3.8(c)) to be used to determine the amounts to be credited or debited to his or her Account Balance for the first day on which the Participant commences participation in the Plan and continuing thereafter for each subsequent day in which the Participant participates in the Plan, unless changed in accordance with the next sentence.  Commencing with the first business day that follows the Participant’s commencement of participation in the Plan and continuing thereafter for each subsequent day in which the Participant participates in the Plan, no later than the close of business on such day, the Participant may (but is not required to) elect, by submitting an Election Form to the Committee that is accepted by the Committee and received by the Company’s third-party administrator, if any, or by submitting changes via the Internet in a manner that is accepted by the Committee, to add or delete one or more Measurement Fund(s) to be used to determine the amounts to be credited or debited to his or her Account Balance, or to change the portion of his or her Account Balance allocated to each previously or newly elected Measurement Fund.  If an election is made in accordance with the previous sentence, it shall apply no later than the close of business on the next business day and continue thereafter for each subsequent day in which the Participant participates in the Plan, unless changed in accordance with the previous sentence.

(b)Proportionate Allocation.  In making any election described in Section 3.8(a), the Participant shall specify on the Election Form, in increments of one (1) percentage point, the percentage of his or her Account Balance to be allocated to a Measurement Fund (as if the Participant was making an investment in that Measurement Fund with that portion of his or her Account Balance).

(c)Measurement Funds.  The Participant may elect one or more of the measurement funds listed at Exhibit A, based on certain mutual funds (the “Measurement Funds”), for the purpose of crediting or debiting additional amounts to his or her Account Balance.  As necessary, the Committee may, in its

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sole discretion, discontinue, substitute or add a Measurement Fund.  Each such action will take effect on the first day of the calendar quarter that follows the day on which the Committee gives Participants advance written notice of such change by at least thirty (30) days.  By way of example, if the Committee decides on March 1st to discontinue a particular Measurement Fund, the Measurement Fund will be discontinued effective April 1.  If the Committee decides on March 15th to discontinue a particular Measurement Fund, the Measurement Fund will not be discontinued until July 1, since thirty days would not have elapsed before the following calendar quarter began on April 1.

(d)Crediting or Debiting Method.  A Participant’s Account Balance shall be credited or debited on a daily basis based on the performance of each Measurement Fund selected by the Participant as though (i) a Participant’s Account Balance were invested in the Measurement Fund(s) selected by the Participant, in the percentages applicable to such business day, at the closing price on such date; (ii) the portion of the Annual Deferral Amount that was actually deferred during any business day was invested in the Measurement Fund(s) selected by the Participant, in the percentages applicable to such business day, no later than the close of business on the first business day after the day on which such amounts are actually deferred from the Participant’s Base Annual Salary, Director’s Fees and/or Annual Bonus through reductions in his or her payroll, at the closing price on such date; and (iii) any distribution made to a Participant that decreases such Participant’s Account Balance ceased being invested in the Measurement Fund(s), in the percentages applicable to such business day, no earlier than one business day prior to the distribution, at the closing price on such date.

(e)No Actual Investment.  Notwithstanding any other provision of this Plan that may be interpreted to the contrary, the Measurement Funds are to be used for measurement purposes only, and a Participant’s election of any such Measurement Fund, the allocation to his or her Account Balance thereto, the calculation of additional amounts and the crediting or debiting of such amounts to a Participant’s Account Balance shall not be considered or construed in any manner as an actual investment of his or her Account Balance in any such Measurement Fund.  In the event that the Company or the Trustee (as that term is defined in the Trust), in its own discretion, decides to invest funds in any or all of the Measurement Funds, no Participant shall have any rights in or to such investments themselves.  Without limiting the foregoing, a Participant’s Account Balance shall at all times be a bookkeeping entry only and shall not represent any investment made on his or her behalf by the Company or the Trust; the Participant shall at all times remain an unsecured creditor of the Company.

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3.9FICA and Other Taxes.

(a)Annual Deferral Amounts.  For each Plan Year in which (i) an Annual Deferral Amount is being withheld from a Participant’s Base Annual Salary or Annual Bonus and/or (ii) an Annual Set-Aside Amount is being contributed on his or her behalf, the Participant’s Employer(s) shall withhold from that portion of the Participant’s Base Annual Salary and Annual Bonus that is not being deferred, in a manner determined by the Employer(s), the Participant’s share of FICA and other employment taxes on such Annual Deferral Amount and/or Annual Set-Aside Amount.

(b)Distributions.  The Participant’s Employer(s), or the trustee of the Trust, shall withhold from any payments made to a Participant under this Plan all federal, state and local income, employment and other taxes required to be withheld by the Employer(s), or the trustee of the Trust, in connection with such payments, in amounts and in a manner to be determined in the sole discretion of the Employer(s) and the trustee of the Trust to the maximum extent permitted under Section 409A.

ARTICLE 4
Specified Time Distribution; Unforeseeable Financial Emergencies;
Early Withdrawal Election

4.1Specified Time Distribution.  In connection with each election to defer an Annual Deferral Amount, a Participant may elect to receive distribution from the Plan with respect to all or a portion of the Annual Deferral Amount as of a specified time.  The Specified Time Distribution shall be a lump sum payment in an amount that is equal to the Annual Deferral Amount that the Participant elected to have distributed as a Specified Time Distribution, plus amounts credited or debited in the manner provided in Section 3.8 on that amount, calculated as of the close of business on which the Specified Time Distribution becomes payable (or, if such date is not a business day, the close of business on the business day next preceding such date), as determined by the Committee in its sole discretion.  Subject to the other terms and conditions of this Plan, each Specified Time Distribution elected shall be paid out within thirty (30) days of the date specified on the Participant’s election.

4.2Other Benefits Take Precedence Over Specified Date Distribution.  Should an event occur that triggers payment of a benefit under ARTICLE 6, ARTICLE 7, ARTICLE 8 or ARTICLE 9, any Annual Deferral Amount, plus amounts credited or debited thereon, that are subject to a Specified Date Distribution election under Section 4.1 while employed shall not be paid in accordance with Section 4.1 but shall be paid in accordance with the other applicable Article.  Notwithstanding the foregoing, the Committee shall interpret this Section 4.2 in a manner consistent of Section 409A.

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4.3Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies.

(a)If the Participant experiences an Unforeseeable Financial Emergency, the Participant may petition the Committee to receive a full or partial payout of his Account Balance due to the Unforeseeable Financial Emergency.  The payout shall not exceed the amount reasonably needed to satisfy the Unforeseeable Financial Emergency plus amounts necessary to pay federal, state, or local income taxes or penalties reasonably anticipated as a result of the payout.  If the Participant receives a distribution due to an Unforeseeable Financial Emergency any deferrals required to be made by a Participant shall be suspended for the remainder of the Plan Year in which the distribution is made.

(b)Notwithstanding the foregoing, a Participant may not receive a payout from the Plan to the extent that the Unforeseeable Financial Emergency is or may be relieved (A) through reimbursement or compensation by insurance or otherwise, (B) by liquidation of the Participant’s assets (other than tax-qualified retirement assets), to the extent the liquidation of such assets would not itself cause severe financial hardship, or (C) by cessation of deferrals under this Plan.  To the extent a Participant’s Unforeseeable Financial Emergency would be relieved by a cessation of deferrals under this Plan, without any accompanying payout, the Participant’s deferrals under this Plan shall be terminated as of the date such determination is made by the Committee.

(c)If the Committee, in its sole discretion, approves a Participant’s petition for payout, the Participant’s deferrals under this Plan shall be terminated as of the date of such approval and the Participant shall receive a payout from the Plan within sixty (60) days of the date of such approval.

(d)In addition, a Participant’s deferral elections under this Plan shall be terminated to the extent the Committee determines, in its sole discretion, that termination of such Participant’s deferral elections is required pursuant to Treasury Regulations Section 1.401(k)-1(d)(3) for the Participant to obtain a hardship distribution from an Employer’s 401(k) plan.  If the Committee determines, in its sole discretion, that a termination of the Participant’s deferral is required in accordance with the preceding sentence, the Participant’s deferrals shall be terminated as soon as administratively practicable following the date on which such determination is made and remain terminated for such period as the Committee determines is necessary to comply with Treasury Regulations Section 1.401(k)-1(d)(3).  Any election to make future deferrals will be subject to the requirements of Section 3.3.

(e)Notwithstanding the foregoing, the Committee shall interpret all provisions relating to termination and/or payout under this Section 4.3 in a manner that is consistent with Section 409A.

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ARTICLE 5
Distributions

5.1Benefit Distribution Date.  A Participant’s Benefit Distribution Date shall be the earliest to occur of the following dates:

(a)The date specified by the Participant for a Specified Date Distribution as provided in Section 4.1;

(b)The date the Participant Retires as provided in ARTICLE 6;

(c)The date the Participant incurs a Termination of Employment as provided in ARTICLE 8;

(d)The date the Participant is Disabled as provided in ARTICLE 9; or

(e)The date the Participant dies as provided in ARTICLE 7.

5.2Limited Cashouts.  Notwithstanding any provision of the Plan or any election of the Participant to the contrary, if a Participant’s accounts have an aggregate value, taking into account any other nonqualified deferred compensation that must be aggregated with this Plan pursuant to Section 409A, measured as of the Participant’s Termination of Employment, that is not greater than the applicable dollar limit under Code Section 402(g)(1)(B) ($15,500 for calendar year 2008), the Participant’s accounts (applying the plan aggregation rules of Section 409A) shall be distributed in a single lump sum.  This Section 5.2 shall be applied in accordance with the plan aggregation rules of Section 409A.  Upon the date of payment pursuant to this Section 5.2, Participant shall have no further interest under the Plan, or any similar deferred compensation arrangements with the Employer as required under Section 409A with the Employer.

5.3Time of Distribution.  Distributions pursuant to this Plan shall be paid in accordance with ARTICLE 4, ARTICLE 6, ARTICLE 7, ARTICLE 8 or ARTICLE 9, provided that:

(a)Any distribution to be made in a lump sum shall be paid no later than sixty (60) days after the end of the Plan Year in which the Participant experiences a Benefit Distribution Date;

(b)Any Distributions to be made pursuant to the Annual Installment Method shall commence no later than sixty (60) days after end of the Plan Year in which the Participant experiences a Benefit Distribution Date and thereafter shall be made no later than fifteen (15) days after the last business day of the preceding month; and

(c)If, as of the effective date of the Participant’s Termination of Employment, the Company is publicly traded and the Participant is a Specified Employee, then, to

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the extent required pursuant to Section 409A, payment of any portion of Plan benefits that would have otherwise have been paid to the Participant during the six-month period following the Participant’s Termination of Employment and which would constitute deferred compensation under Section 409A (the “Delayed Payments”) shall be delayed until the date that is six (6) months and one day following Participant’s Termination of Employment or, if earlier, the date of the Participant’s death (the “Delayed Payment Date”).  As of the Delayed Payment Date, the Delayed Payments plus interest (as provided in Section 3.8), for the period of the delay, shall be paid to the Participant in a single lump sum.  Any portion of the Plan benefit that was not otherwise due to be paid during the six-month period following the Participant’s Termination of Employment shall be paid to the Participant in accordance with the payment scheduled set forth under the applicable distribution provision of the Plan.

(d)To the extent that the Participant has a choice of distribution methods and the Participant does not make such election, then such Participant shall be deemed to have elected to receive the benefit in a lump sum.

5.4Change to Election Forms.  A Participant may delay the Benefit Distribution Date or change the form of payment of the Participant’s Account Balance by submitting a new Election Form to the Committee in accordance with the following criteria:

(a)The election to modify the time of payment of a scheduled distribution or to modify the form of payment of the Participant’s Account Balance shall have no effect until at least twelve (12) months after the date on which the new election is made.

(b)With respect to payments, other than as described in Sections 4.3 (Unforeseeable Financial Emergency), 5.1(d) (Disability) or 5.1(e) (death), the first payment pursuant to the modified election shall be delayed for a period of not less than five (5) years from the Participant’s originally scheduled Benefit Distribution Date.

(c)With respect to payments, other than as described in Sections 4.3 (Unforeseeable Financial Emergency), 5.1(d) (Disability) or 5.1(e) (death), the new election may not be made less than twelve (12) months prior to the first scheduled payment under the Participant’s originally scheduled Benefit Distribution Date.

(d)Notwithstanding the foregoing, the Committee shall interpret all provisions relating to changing an election under this Section 5.4 in a manner that is consistent with Section 409A.

(e)Subject to the applicability of subsection (f) below, the Election Form most recently accepted by the Committee, which has become effective, shall govern the payout of any benefit.

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(f)In a manner that is consistent with Section 409A, the Committee may solicit new Election Forms from Participants in order for the Participants to change the method or timing of distributions of all amounts subject to Section 409A under the Plan, provided such elections are solicited and properly made prior to December 31, 2008.  In the event the Committee elects to solicit new Election Forms under this Section, the failure by the Participant to submit a complete and timely Election Form will result in the application of the most recently submitted Election Form.

ARTICLE 6
Retirement Benefit

6.1Retirement Benefit.  A Participant who Retires shall receive, as a Retirement Benefit, his or her Account Balance.

6.2Payment of Retirement Benefit.  A Participant, in connection with each election to defer Annual Deferral Amounts, shall elect on an Election Form to receive the Retirement Benefit, subject to Section 5.2 (Limited Cashouts), in either (a) a lump sum, or (b) pursuant to an Annual Installment Method of up to fifteen (15) years, or (c) a combination of a lump sum payment followed by installment payments made pursuant to an Annual Installment Method of up to fifteen (15) years.  The lump sum payment shall be made, or installment payments shall commence, no later than sixty (60) days after the last day of the Plan Year in which the Participant Retires.  If a Participant elects to receive a lump sum and installment payments, the lump sum payment shall be made no later than sixty (60) days after the last day of the Plan Year in which the Participant Retires and installment payments shall commence no later than sixty (60) days after the last day of the following Plan Year.

6.3Death Prior to Completion of Retirement Benefit.  A Participant, in connection with each election to defer Annual Deferral Amounts, shall elect on an Election Form the manner in which his or her Beneficiary will receive the Participant’s unpaid Retirement Benefit, should the Participant die after Retirement but before the Retirement Benefit is paid in full.  The Participant shall elect to have the unpaid Retirement Benefit paid to his or her Beneficiary (a) over the remaining number of years and in the same amounts as that benefit would have been paid to the Participant had the Participant survived, or (b) in a lump sum payment equal to the Participant’s unpaid remaining Account Balance.  If a Participant does not make any election with respect to the payment of the unpaid Retirement Benefit, then such benefit shall be paid in a lump sum no more than sixty (60) days, after the last day of the Plan Year in which the Committee is provided with proof that is satisfactory to the Committee of the Participant’s death.

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ARTICLE 7
Pre-Retirement Survivor Benefit

7.1Pre-Retirement Survivor Benefit.  The Participant’s Beneficiary shall receive a Pre-Retirement Survivor Benefit equal to the Participant’s Account Balance if the Participant dies before he or she Retires, experiences a Termination of Employment or suffers a Disability.

7.2Payment of Pre-Retirement Survivor Benefit.  A Participant, in connection with each election to defer Annual Deferral Amounts, shall elect on an Election Form to receive the Pre-Retirement Survivor Benefit, subject to Section 5.2 (Limited Cashouts), by his or her Beneficiary in either (a) a lump sum or (b) pursuant to an Annual Installment Method of up to fifteen (15) years.  If a Participant does not make any election with respect to the payment of the Pre-Retirement Survivor Benefit, then such benefit shall be paid in a lump sum.  The lump sum payment shall be made as soon as practical, but no more than sixty (60) days, after the last day of the Plan Year in which the Committee is provided with proof that is satisfactory to the Committee of the Participant’s death.

ARTICLE 8
Termination Benefit

8.1Termination Benefit.  The Participant shall receive a Termination Benefit, which shall be equal to the Participant’s Account Balance if a Participant experiences a Termination of Employment prior to his or her Retirement, death, or Disability.

8.2Payment of Termination Benefit.  Except as provided in Section 5.2 (Limited Cashouts), the Committee shall cause the Termination Benefit to be paid as elected by the Participant on his Election Form, a follows: (a) in a lump sum or (b) pursuant to an Annual Installment Method of five (5) years.  The lump sum payment, if elected, shall be made, or installment payments, if elected, shall commence, as soon as practical, but no more than sixty (60) days, after the last day of the Plan Year in which the Participant experiences the Termination of Employment.

ARTICLE 9
Disability Benefit

9.1Disability Benefit.  Upon a Participant’s Disability, the Participant shall receive a Disability Benefit, which shall be equal to the Participant’s Account Balance, calculated as of the close of business on the Participant’s Benefit Distribution Date (or, if such date is not a business day, the close of business on the business day next preceding such date).

9.2Payment of Disability Benefit.  The Disability Benefit shall be paid in a lump sum to the Participant and shall be paid as provided in ARTICLE 5.

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ARTICLE 10
Beneficiary Designation

10.1Beneficiary.  Each Participant shall have the right, at any time, to designate his or her Beneficiary(ies) (both primary as well as contingent) to receive any benefits payable under the Plan to a beneficiary upon the death of a Participant.  The Beneficiary designated under this Plan may be the same as or different from the Beneficiary designation under any other plan of an Employer in which the Participant participates.

10.2Beneficiary Designation; Change; Spousal Consent.  A Participant shall designate his or her Beneficiary by completing and signing the Beneficiary Designation Form, and returning it to the Committee or its designated agent.  A Participant shall have the right to change a Beneficiary by completing, signing and otherwise complying with the terms of the Beneficiary Designation Form and the Committee’s rules and procedures, as in effect from time to time.  If the Participant names someone other than his or her spouse as a Beneficiary, a spousal consent, in the form designated by the Committee, must be signed by that Participant’s spouse and returned to the Committee.  Upon the acceptance by the Committee of a new Beneficiary Designation Form, all Beneficiary designations previously filed shall be canceled.  The Committee shall be entitled to rely on the last Beneficiary Designation Form filed by the Participant and accepted by the Committee prior to his or her death.

10.3Acknowledgment.  No designation or change in designation of a Beneficiary shall be effective until received and acknowledged in writing by the Committee or its designated agent.

10.4No Beneficiary Designation.  If a Participant fails to designate a Beneficiary as provided in Sections 10.1, 10.2 and 10.3 above or, if all designated Beneficiaries predecease the Participant or die prior to complete distribution of the Participant’s benefits, then the Participant’s designated Beneficiary shall be deemed to be his or her surviving spouse.  If the Participant has no surviving spouse, the benefits remaining under the Plan to be paid to a Beneficiary shall be payable to the executor or personal representative of the Participant’s estate.

10.5Doubt as to Beneficiary.  If the Committee has any doubt as to the proper Beneficiary to receive payments pursuant to this Plan, the Committee shall have the right, exercisable in its discretion, to cause the Participant’s Employer to withhold such payments until this matter is resolved to the Committee’s satisfaction.

10.6Discharge of Obligations.  The payment of benefits under the Plan to a Beneficiary shall fully and completely discharge all Employers and the Committee from all further obligations under this Plan with respect to the Participant, and that Participant’s Participation Agreement shall terminate upon such full payment of benefits.

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ARTICLE 11
Leave of Absence

11.1Paid Leave of Absence.  If a Participant is authorized by the Participant’s Employer to take a paid leave of absence from the employment of the Employer, and such leave of absence does not constitute a Termination of Employment, as determined by the Committee in accordance with Section 409A, (i) the Participant shall continue to be considered eligible for the benefits provided in ARTICLE 4, ARTICLE 6, ARTICLE 7, ARTICLE 8 or ARTICLE 9 in accordance with the provisions of those Articles, (ii) the Annual Deferral Amount shall continue to be withheld during such paid leave of absence in accordance with Section 3.2 (to the extent that any Base Annual Salary or Annual Bonus is being paid, and proportionately adjusted in the case that Base Annual Salary or Annual Bonus has been impacted by such leave of absence, as permitted under Section 409A), and (iii) the Participant shall not be deemed to have had a Termination of Employment.

11.2Unpaid Leave of Absence.  If a Participant is authorized by the Participant’s Employer to take an unpaid leave of absence from the employment of the Employer for any reason, and such leave of absence does not constitute a Termination of Employment, as determined by the Committee in accordance with Section 409A, such Participant shall continue to be eligible for the benefits provided in ARTICLE 4, ARTICLE 6, ARTICLE 7, ARTICLE 8 or ARTICLE 9 in accordance with the provisions of those Articles and shall not be deemed to have had a Termination of Employment.  However, to the extent permitted under Section 409A, the Participant shall be excused from fulfilling his or her Annual Deferral Amount commitment that would otherwise have been withheld during the remainder of the Plan Year in which the unpaid leave of absence is taken.  During the unpaid leave of absence, the Participant shall not be allowed to make any additional deferral elections.  However, if the Participant returns to employment, the Participant may elect to defer an Annual Deferral Amount for the Plan Year following his or her return to employment and for every Plan Year thereafter while a Participant in the Plan; provided such deferral elections are otherwise allowed and an Election Form is delivered to and accepted by the Committee or its designee for each such election in accordance with Section 3.3 above.

11.3Leaves Resulting in Termination of Employment.  In the event that a Participant’s leave of absence from the employment of the Participant’s Employer does constitute a Termination of Employment, as determined by the Committee in accordance with Section 409A, the Participant’s vested Account Balance shall be distributed to the Participant in accordance with ARTICLE 6 or ARTICLE 8, as applicable.

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ARTICLE 12
Termination, Amendment or Modification

12.1Termination.  Although the Company and the Employers anticipate that they will continue the Plan for an indefinite period of time, there is no guarantee that the Company will continue the Plan or will not terminate or freeze the Plan at any time in the future or that an Employer will continue participating in the Plan or will not terminate its participation in the Plan.  Accordingly, to the maximum extent permissible under Section 409A, the Company reserves the right to discontinue its sponsorship of the Plan and/or to terminate the Plan at any time with respect to any or all of the Employers or any or all of its participating Employees, by action of its board of directors.  In addition, to the maximum extent permissible under Section 409A, each Employer reserves the right to discontinue its participation in the Plan by action of its board of directors.  Upon the termination of the Plan, the participation of the affected Participants shall terminate and their vested Account Balances shall be distributed in accordance with the requirements of Section 409A.  The termination of the Plan shall not adversely affect any Participant or Beneficiary who has become entitled to the payment of any benefits under the Plan as of the date of termination; provided however, that, as may be permitted under Section 409A, the Company shall have the right to accelerate installment payments without a premium or prepayment penalty by paying the vested Account Balance in a lump sum.

12.2Amendment.

(a)Prior to a Change in Control, any Employer may, at any time, amend or modify the Plan in whole or in part with respect to that Employer by the action of its board of directors; provided, however, that: (i) no amendment or modification shall be effective to decrease or restrict the value of a Participant’s Account Balance in existence at the time the amendment or modification is made, calculated as if the Participant had experienced a Termination of Employment as of the effective date of the amendment or modification or, if the amendment or modification occurs after the date upon which the Participant was eligible to Retire, the Participant had Retired as of the effective date of the amendment or modification, (ii) no amendment or modification of this Section 12.2 or Section 13.2 of the Plan shall be effective, and (iii) no amendment or modification shall be made unless such amendment or modification complies with Section 409A.  The amendment or modification of the Plan shall not affect any Participant or Beneficiary who has become entitled to the payment of benefits under the Plan as of the date of the amendment or modification; provided, however, that the Employer shall have the right, prior to a Change in Control, to accelerate installment payments by paying the Account Balance in a lump sum or pursuant to an Annual Installment Method using fewer years.  Upon a Change in Control, this Plan may not be amended or modified without the express written consent of all Plan Participants.

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(b)Notwithstanding any provisions of the Plan to the contrary, in the event that the Company determines that any provision of the Plan may violate or otherwise not comply with Section 409A, the Company may, without the consent of any Employer, Participant or Beneficiary: (i) adopt such amendments to the Plan and appropriate policies and procedures, including amendments and policies with retroactive effect, that the Company determines necessary or appropriate to preserve the intended treatment of the Plan or the benefits provided by the Plan and/or (ii) take such other actions as the Company determines necessary or appropriate to comply with the requirements of Section 409A.

12.3Effect of Payment.  The full payment of the applicable benefit under ARTICLE 4, ARTICLE 5, ARTICLE 6, ARTICLE 7, ARTICLE 8 or ARTICLE 9 of the Plan shall completely discharge all obligations to a Participant and his or her designated Beneficiaries under this Plan and the Participant’s Participation Agreement shall terminate.

ARTICLE 13
Administration

13.1Committee Duties.  Except as otherwise provided in this ARTICLE 13, this Plan shall be administered by a Committee which shall consist of the Board, or such committee as the Board shall appoint.  Members of the Committee may be Participants under this Plan.  The Committee shall also have the discretion and authority to (i) make, amend, interpret, and enforce all appropriate rules and regulations for the administration of this Plan and (ii) decide or resolve any and all questions including interpretations of this Plan, as may arise in connection with the Plan.  Any individual serving on the Committee who is a Participant shall not vote or act on any matter relating solely to himself or herself.  When making a determination or calculation, the Committee shall be entitled to rely on information furnished by a Participant or the Company.

13.2Administration Upon Change In Control.  For purposes of this Plan, the Committee shall be the “Administrator” at all times prior to the occurrence of a Change in Control.  Upon and after the occurrence of a Change in Control, the “Administrator” shall be an independent third party selected by the Trustee of the Trust and approved by the individual who, immediately prior to such event, was the Company’s Chief Executive Officer or, if not so identified, the Company’s highest ranking officer (the “Ex-CEO”).  The Administrator shall have the discretionary power to determine all questions arising in connection with the administration of the Plan and the interpretation of the Plan and Trust including, but not limited to benefit entitlement determinations; provided, however, upon and after the occurrence of a Change in Control, the Administrator shall have no power to direct the investment of Plan or Trust assets or select any investment manager or custodial firm for the Plan or Trust.  Upon and after the occurrence of a Change in Control, the Company must: (1) pay all reasonable administrative expenses and fees of the Administrator; (2) indemnify the Administrator against any costs, expenses and

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liabilities including, without limitation, attorney’s fees and expenses arising in connection with the performance of the Administrator hereunder, except with respect to matters resulting from the gross negligence or willful misconduct of the Administrator or its employees or agents; and (3) supply full and timely information to the Administrator or all matters relating to the Plan, the Trust, the Participants and their Beneficiaries, the Account Balances of the Participants, the date of circumstances of the Retirement, Disability, death or Termination of Employment of the Participants, and such other pertinent information as the Administrator may reasonably require.  Upon and after a Change in Control, the Administrator may be terminated (and a replacement appointed) by the Trustee only with the approval of the Ex-CEO.  Upon and after a Change in Control, the Administrator may not be terminated by the Company.

13.3Agents.  In the administration of this Plan, the Committee may, from time to time, employ agents and delegate to them such administrative duties as it sees fit (including acting through a duly appointed representative) and may from time to time consult with counsel who may be counsel to any Employer.

13.4Binding Effect of Decisions.  The decision or action of the Administrator with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any interest in the Plan.

13.5Indemnity of Committee.  All Employers shall indemnify and hold harmless the members of the Committee, any Employee to whom the duties of the Committee may be delegated, and the Administrator against any and all claims, losses, damages, expenses or liabilities arising from any action or failure to act with respect to this Plan, except in the case of willful misconduct by the Committee, any of its members, any such Employee or the Administrator.

13.6Employer Information.  To enable the Committee and/or Administrator to perform its functions, the Company and each Employer shall supply full and timely information to the Committee and/or Administrator, as the case may be, on all matters relating to the compensation of its Participants, the date and circumstances of the Retirement, Disability, death or circumstances of the Retirement, Disability, death or Termination of Employment of its Participants, and such other pertinent information as the Committee or Administrator may reasonably require.

ARTICLE 14
Other Benefits and Agreements

14.1Coordination with Other Benefits.  The benefits provided for a Participant and Participant’s Beneficiary under the Plan are in addition to any other benefits available to such Participant under any other plan or program for employees of the Participant’s Employer.  The Plan shall supplement and shall not supersede, modify or amend any other such plan or program except as may otherwise be expressly provided.

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ARTICLE 15
Claims Procedures

15.1Presentation of Claim.  Any Participant or Beneficiary of a deceased Participant (such Participant or Beneficiary being referred to below as a “Claimant”) may deliver to the Committee a written claim for a determination with respect to the amounts distributable to such Claimant from the Plan.  If such a claim relates to the contents of a notice received by the Claimant, the claim must be made within sixty (60) days after such notice was received by the Claimant.  All other claims must be made within 180 days of the date on which the event that caused the claim to arise occurred.  The claim must state with particularity the determination desired by the Claimant.

15.2Notification of Decision.  The Committee shall consider a Claimant’s claim within a reasonable time, but no later than ninety (90) days (forty-five (45) days in the case of a claim based on Disability) after receiving the claim.  If the Committee determines that special circumstances require an extension of time for processing the claim, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial ninety (90) day (forty-five (45) day, in the case of a claim based on Disability) period.  In no event shall such extension exceed a period of ninety (90) days (thirty (30) days, in the case of a claim based on Disability) from the end of the initial period.  The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Committee expects to render the benefit determination.  The Committee shall notify the Claimant in writing:

(a)that the Claimant’s requested determination has been made, and that the claim has been allowed in full; or

(b)that the Committee has reached a conclusion contrary, in whole or in part, to the Claimant’s requested determination, and such notice must set forth in a manner calculated to be understood by the Claimant:

(i)the specific reason(s) for the denial of the claim, or any part of it;

(ii)specific reference(s) to pertinent provisions of the Plan upon which such denial was based;

(iii)a description of any additional material or information necessary for the Claimant to perfect the claim, and an explanation of why such material or information is necessary;

(iv)an explanation of the claim review procedure set forth in Section 15.3 below; and

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

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15.3Review of a Denied Claim.  On or before sixty (60) days (one hundred-eighty (180) days, in the case of a claim based on Disability) after receiving a notice from the Committee that a claim has been denied, in whole or in part, a Claimant (or the Claimant’s duly authorized representative) may file with the Committee a written request for a review of the denial of the claim.  The Claimant (or the Claimant’s duly authorized representative):

(a)may, upon request and free of charge, have reasonable access to, and copies of, all documents, records and other information relevant to the claim for benefits;

(b)may submit written comments or other documents; and/or

(c)may request a hearing, which the Committee, in its sole discretion, may grant.

15.4Decision on Review.  The Committee shall render its decision on review promptly, and no later than sixty (60) days (forty-five (45) days, in the case of a claim based on Disability) after the Committee receives the Claimant’s written request for a review of the denial of the claim.  If the Committee determines that special circumstances require an extension of time for processing the claim, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial sixty (60) day period.  In no event shall such extension exceed a period of sixty (60) days (forty-five (45) days, in the case of a claim based on Disability) from the end of the initial period.  The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Committee expects to render the benefit determination.  In rendering its decision, the Committee shall take into account all comments, documents, records and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.  The decision must be written in a manner calculated to be understood by the Claimant, and it must contain:

(a)specific reasons for the decision;

(b)specific reference(s) to the pertinent Plan provisions upon which the decision was based;

(c)a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the Claimant’s claim for benefits; and

(d)a statement of the Claimant’s right to bring a civil action under ERISA Section 502(a).

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15.5Legal Action.  A Claimant’s compliance with the foregoing provisions of this ARTICLE 15 is a mandatory prerequisite to a Claimant’s right to commence any legal action with respect to any claim for benefits under this Plan.

ARTICLE 16
Trust

16.1Establishment of the Trust.  The Company may, in its sole discretion, establish the Trust.  If the Company establishes a Trust, each Employer shall at least annually transfer over to the Trust such assets as the Employer determines, in its sole discretion, are necessary to provide, on a present value basis, for its respective future liabilities created with respect to the Annual Deferral Amounts, and Annual Set-Aside Amounts for such Employer’s Participants for all periods prior to the transfer, as well as any debits and credits to the Participants’ Account Balances for all periods prior to the transfer, taking into consideration the value of the assets in the trust at the time of the transfer.

16.2Interrelationship of the Plan and the Trust.  The provisions of the Plan and the Participation Agreement shall govern the rights of a Participant to receive distributions pursuant to the Plan.  The provisions of the Trust, if established, shall govern the rights of the Employers, Participants and the creditors of the Employers to the assets transferred to the Trust.  Each Employer shall at all times remain liable to carry out its obligations under the Plan.

16.3Distributions From the Trust.  Each Employer’s obligations under the Plan may be satisfied with Trust assets distributed pursuant to the terms of the Trust, and any such distribution shall reduce the Employer’s obligations under this Plan.

ARTICLE 17
Miscellaneous

17.1Status of Plan.  The Plan is intended to be a plan that is not qualified within the meaning of Code Section 401(a) and that “is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employee” within the meaning of ERISA Sections 201(2), 301(a)(3) and 401(a)(1).  The Plan shall be administered and interpreted to the extent possible in a manner consistent with that intent.

17.2Unsecured General Creditor.  Participants and their Beneficiaries, heirs, successors and assigns shall have no legal or equitable rights, interests or claims in any property or assets of an Employer.  For purposes of the payment of benefits under this Plan, any and all of an Employer’s assets shall be, and remain, the general, unpledged unrestricted assets of the Employer.  An Employer’s obligation under the Plan shall be merely that of an unfunded and unsecured promise to pay money in the future.

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17.3Employer’s Liability.  An Employer’s liability for the payment of benefits shall be defined only by the Plan and the Participation Agreement, as entered into between the Employer and a Participant.  An Employer shall have no obligation to a Participant under the Plan except as expressly provided in the Plan and his or her Participation Agreement.

17.4Nonassignability.  Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage or otherwise encumber, transfer, hypothecate, alienate or convey in advance of actual receipt, the amounts, if any, payable hereunder, or any part thereof, which are, and all rights to which are expressly declared to be, unassignable and non-transferable.  No part of the amounts payable shall, prior to actual payment, be subject to seizure, attachment, garnishment or sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or any other person, be transferable by operation of law in the event of a Participant’s or any other person’s bankruptcy or insolvency or be transferable to a spouse as a result of a property settlement or otherwise.

17.5Not a Contract of Employment.  The terms and conditions of this Plan shall not be deemed to constitute a contract of employment between any Employer and the Participant.  Such employment is hereby acknowledged to be an “at will” employment relationship that can be terminated at any time for any reason, or no reason, with or without cause, and with or without notice, unless expressly provided in a written employment agreement.  Nothing in this Plan shall be deemed to give a Participant the right to be retained in the service of any Employer, either as an Employee or a Director, or to interfere with the right of any Employer to discipline or discharge the Participant at any time.

17.6Furnishing Information.  A Participant or his or her Beneficiary will cooperate with the Committee by furnishing any and all information requested by the Committee and take such other actions as may be requested in order to facilitate the administration of the Plan and the payments of benefits hereunder, including but not limited to taking such physical examinations as the Committee may deem necessary.

17.7Terms.  Whenever any words are used herein in the masculine, they shall be construed as though they were in the feminine in all cases where they would so apply; and whenever any words are used herein in the singular or in the plural, they shall be construed as though they were used in the plural or the singular, as the case may be, in all cases where they would so apply.

17.8Captions.  The captions of the articles, sections and paragraphs of this Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions.

17.9Governing Law.  Subject to ERISA, the provisions of this Plan shall be construed and interpreted according to the internal laws of the State of Illinois without regard to its conflicts of laws principles.

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17.10Notice.  Any notice or filing required or permitted to be given to the Committee under this Plan shall be sufficient if in writing and hand-delivered, or sent by registered or certified mail, to the address below:

Duane G. Debs

President and Chief Financial Officer

West Suburban Bancorp, Inc.

2800 S. Finley Rd.

Downers Grove, IL 60515

Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

Any notice or filing required or permitted to be given to a Participant under this Plan shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Participant.

17.11Successors.  The provisions of this Plan shall bind and inure to the benefit of the Participant’s Employer and its successors and assigns and the Participant and the Participant’s designated Beneficiaries.

17.12Spouse’s Interest.  The interest in the benefits hereunder of a spouse of a Participant who has predeceased the Participant shall automatically pass to the Participant and shall not be transferable by such spouse in any manner, including but not limited to such spouse’s will, nor shall such interest pass under the laws of intestate succession.

17.13Validity.  In case any provision of this Plan shall be illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts hereof, but this Plan shall be construed and enforced as if such illegal or invalid provision had never been inserted herein.

17.14Incompetent.  If the Committee determines in its discretion that a benefit under this Plan is to be paid to a minor, a person declared incompetent or to a person incapable of handling the disposition of that person’s property, the Committee may direct payment of such benefit to the guardian, legal representative or person having the care and custody of such minor, incompetent or incapable person.  The Committee may require proof of minority, incompetence, incapacity or guardianship, as it may deem appropriate prior to distribution of the benefit.  Any payment of a benefit shall be a payment for the account of the Participant and the Participant’s Beneficiary, as the case may be, and shall be a complete discharge of any liability under the Plan for such payment amount.

17.15Court Order.  The Committee is authorized to make any payments directed by court order in any action in which the Plan or the Committee has been named as a party.  In addition, if a court determines that a spouse or former spouse of a Participant has an interest in the Participant’s benefits under the Plan in connection with a property

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settlement or otherwise, the Committee, in its sole discretion, shall have the right, notwithstanding any election made by a Participant, to immediately distribute the spouse’s or former spouse’s interest in the Participant’s benefits under the Plan to that spouse or former spouse.  Notwithstanding the foregoing, the Committee shall interpret this provision in a manner consistent with Section 409A.

17.16Distribution in the Event of Income Inclusion under Section 409A.  If any portion of a Participant’s Account Balance under this Plan is required to be included in income by the Participant prior to receipt due to a failure of this Plan to meet the requirements of Section 409A, the Participant may petition the Committee or Administrator, as applicable, for a distribution of that portion of his or her Account Balance that is required to be included in his or her income.  Upon the grant of such a petition, which grant shall not be unreasonably withheld, the Employer shall distribute to the Participant immediately available funds in an amount equal to the portion of his or her Account Balance required to be included in income as a result of the failure of the Plan to meet the requirements of Section 409A, which amount shall not exceed the Participant’s unpaid Account Balance under the Plan.  If the petition is granted, such distribution shall be made within ninety (90) days of the date when the Participant’s petition is granted.  Such a distribution shall affect and reduce the Participant’s benefits to be paid under this Plan.

17.17Deduction Limitation on Benefit Payments.  If the Company determines in good faith prior to a Change in Control that there is a reasonable likelihood that any compensation paid to a Participant for a taxable year of the Company would not be deductible by the Company solely by reason of the limitation under Code Section 162(m), then to the extent deemed necessary by the Company to ensure that the entire amount of any distribution to the Participant pursuant to this Plan prior to the Change in Control is deductible, the Company may defer all or any portion of a distribution under this Plan.  Any amounts deferred pursuant to this limitation shall continue to be credited/debited with additional amounts in accordance with Section 3.8 above.  The amounts so deferred and amounts credited thereon shall be distributed, in accordance with the requirements of Section 409A, to the Participant or his or her Beneficiary (in the event of the Participant’s death) in a single lump sum at the earliest possible date, as determined by the Company in good faith, on which the deductibility of compensation paid or payable to the Participant for the taxable year of the Company during which the distribution is made will not be limited by Code Section 162(m).

17.18Insurance.  The Employers, on their own behalf or on behalf of the trustee of the Trust, and, in their sole discretion, may apply for and procure insurance on the life of the Participant, in such amounts and in such forms as the Trust may choose.  The Employers or the trustee of the Trust, as the case may be, shall be the sole owner and beneficiary of any such insurance.  The Participant shall have no interest whatsoever in any such policy or policies, and at the request of the Employers shall submit to medical examinations and supply such information and execute such documents as may be required by the insurance company or companies to whom the Employers have applied for insurance.

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17.19Legal Fees To Enforce Rights After Change in Control.  The Company and each Employer is aware that upon the occurrence of a Change in Control, the Board or the board of directors of a Participant’s Employer (which might then be composed of new members) or a shareholder of the Company or the Participant’s Employer, or of any successor corporation might then cause or attempt to cause the Company, the Participant’s Employer or such successor to refuse to comply with its obligations under the Plan and might cause or attempt to cause the Company or the Participant’s Employer to institute, or may institute, litigation seeking to deny Participants the benefits intended under the Plan.  In these circumstances, the purpose of the Plan could be frustrated.  Accordingly, if, following a Change in Control, it should appear to any Participant that the Company, the Participant’s Employer or any successor corporation has failed to comply with any of its obligations under the Plan or any agreement thereunder or, if the Company, such Employer or any other person takes any action to declare the Plan void or unenforceable or institutes any litigation or other legal action designed to deny, diminish or to recover from any Participant the benefits intended to be provided, then the Company and the Participant’s Employer irrevocably authorize such Participant to retain counsel of his or her choice at the expense of the Company and the Participant’s Employer (who shall be jointly and severally liable) to represent such Participant in connection with the initiation or defense of any litigation or other legal action, whether by or against the Company, the Participant’s Employer or any director, officer, shareholder or other person affiliated with the Company, the Participant’s Employer or any successor thereto in any jurisdiction.  Notwithstanding the foregoing, the Employer shall be liable for legal fees and expenses pursuant to this Section 17.19 only to the extent incurred in connection with a “bona fide” dispute as provided under Section 409A.  All payments made hereunder shall be paid or reimbursed by the Employer not later than December 31st of the year following the year in which the fees were incurred.

IN WITNESS WHEREOF, the Company has signed this Plan document as of December 30, 2008.

WEST SUBURBAN BANCORP, INC., an Illinois corporation
By:	/s/ Duane G. Debs
Title:	President

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Measurement Funds

Following is a list of the Measurement Funds currently available under the Plan:

1.Dreyfus Mid Cap Index Fund (described as a mutual fund seeking capital appreciation by matching the performance of the S&P 400 Index);

2.Fidelity Growth Portfolio (described as a mutual fund which seeks capital appreciation by investing in equity securities of companies with above-average growth potential);

3.Fidelity VIP II Contrafund Portfolio (described as a mutual fund which seeks long-term capital appreciation by investing in equity securities of companies whose value the manager believes may not be fully recognized by the public);

4.J.P. Morgan Balanced Fund (described as a mutual fund which seeks as high a level of current income as is consistent with the preservation of capital);

5.MAS NSAT Multi Sector Bond Fund (described as a mutual fund which seeks a high level of current income and capital appreciation);

6.Nationwide (Dreyfus) Small Cap Value Fund (described as a mutual fund which seeks capital appreciation by investing primarily in equity securities of companies with a median market capitalization of approximately $1 billion);

7.Nationwide Money Market Fund (described as a mutual fund which seeks as high a level of current income as is consistent with the preservation of capital and maintenance of liquidity by investing primarily in high-quality money market obligations);

8.NSAT Government Bond Fund (described as a mutual fund which seeks to provide as high a level of income as is consistent with the preservation of capital);

9.Oppenheimer Capital Appreciation Fund (described as a mutual fund which seeks capital appreciation by investing in equity securities of well-established companies); and

10.Oppenheimer Global Securities Fund (described as a mutual fund which seeks long-term capital appreciation by investing primarily in equity securities in foreign and U.S. markets).

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EX-10.2

Exhibit 10.2

WEST SUBURBAN BANCORP, INC.

RESTATED EMPLOYMENT AGREEMENT – KEVIN J. ACKER

This RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), is made and entered into as of the 29th day of December, 2008 (the “Effective Date”), by and between WEST SUBURBAN BANCORP, INC., an Illinois corporation (the “Employer”), and KEVIN J. ACKER, an Illinois resident (the “Executive”).

R E C I T A L S:

A.            The Employer owns all of the issued and outstanding capital stock of West Suburban Bank, Lombard, Illinois (the “Bank”).

B.             The Employer desires to continue to employ the Executive as an officer of the Employer and of the Bank for a specified term and the Executive is willing to continue such employment upon the terms and conditions hereinafter set forth.

C.             Additionally, the Employer recognizes that circumstances may arise which may result in a change in control of the Employer and/or the Bank (through acquisition or otherwise) thereby causing uncertainty with respect to the Executive’s employment without regard to the competence or past contributions of the Executive and that such uncertainty may result in the loss to the Employer and/or the Bank of the valuable services provided by the Executive.  In such circumstances, the Employer and the Executive wish to provide reasonable security to the Executive against changes in the Executive’s employment relationship with the Employer and/or the Bank.

D.            The Executive currently serves as the Chief Executive Officer of Employer and the Senior Vice President, Marketing of the Bank pursuant to that certain Employment Agreement dated March 8, 2004, as amended (the “Employment Agreement”).

E.             The parties desire to amend and restate the Employment Agreement in accordance with the terms, and subject to the conditions, set forth herein in order to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the related U.S. Treasury Department regulations and guidance promulgated thereunder (“Code Section 409A”).

NOW, THEREFORE, in consideration of the promises and of the covenants and agreements hereinafter contained, it is covenanted and agreed by and between the parties hereto as follows:

A G R E E M E N T S:

1.             TERM OF EMPLOYMENT WITH AUTOMATIC RENEWAL PROVISIONS.  The period of the Executive’s employment under this Agreement shall be deemed to have commenced on the Effective Date and shall continue for a period of approximately three (3) years through December 31, 2011.  The term of employment of the Executive under this Agreement shall automatically be extended for one (1) additional year

on December 31st of each year beginning December 31, 2009, unless either the Employer or the Executive notifies the other party, by written notice delivered no later than November 1st of such year, that the term of employment of the Executive under this Agreement shall not be extended for an additional year.  In addition, upon the occurrence of a Change in Control (as defined below), the term of employment of the Executive under this Agreement shall be automatically renewed and extended to provide a term of employment (in accordance with the terms, and subject to the conditions, set forth herein) equal to a period of three (3) years from the date of the consummation of the Change in Control.

2.             POSITION AND DUTIES.  The Employer hereby continues to employ the Executive as the Chief Executive Officer of the Employer and as the Senior Vice President, Marketing of the Bank or in such other senior executive capacity as shall be mutually agreed between the Employer and the Executive.  During the period of the Executive’s employment hereunder, the Executive shall devote his best efforts and full business time, energy, skills and attention to the business and affairs of the Employer and its affiliates, including the Bank.  The Executive’s duties and authority shall consist of and include all duties and authority customarily performed and held by persons holding equivalent positions with business organizations similar in nature and size to the Employer, as such duties and authority are reasonably defined, modified and delegated from time to time by the Board of Directors of the Employer (the “Board”).  The Executive shall have the powers necessary to perform the duties assigned to him and shall be provided such supporting services, staff and other assistance, office space and accoutrements as shall be reasonably necessary and appropriate in the light of such assigned duties.

3.             COMPENSATION.  As compensation for the services to be provided by the Executive hereunder, the Executive shall receive the following compensation, expense reimbursement and other benefits:

(a)           BASE SALARY.  The Executive shall receive an aggregate annual minimum base salary at the rate of two hundred seventy six thousand seven hundred ninety four and 91/100 dollars ($276,794.91) payable in installments in accordance with the regular payroll schedule of the Bank (“Base Salary”).  Such Base Salary shall be subject to review annually commencing in 2009 and shall be maintained or increased during the term hereof in accordance with the Employer’s established management compensation policies and practices.

(b)           BONUS.  The Executive shall be eligible for an annual bonus (“Bonus”) with respect to each fiscal year of the Employer in accordance with the Employer’s compensation and bonus policies and practices for senior executive officers.  The amount of the Bonus, if any, shall be determined by the Compensation Committee of the Board (the “Compensation Committee”).  The Bonus, if any, shall be paid no later than March 15th of the year following the calendar year in which the Bonus is earned.

(c)           DEFERRED COMPENSATION.  The Employer shall make contributions for the benefit of the Executive to the Employer’s Directors and Senior Management Deferred Compensation Plan (“Deferred Compensation Plan”), including any successor plan or program thereto, in an annual amount of not less than twenty-five thousand dollars ($25,000).

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(d)           VACATIONS.  The Executive shall receive paid vacation days of at least such number of paid vacation days as the Executive shall be entitled to receive as of the date hereof in accordance with the Employer’s vacation policy in effect as of the date hereof.  The method of accrual, forfeiture and scheduling of vacation days shall be in accordance with, and subject to, the Employer’s general vacation policies and practices.

(e)           LONG TERM CARE INSURANCE.  The Employer shall provide the Executive and the Executive’s spouse with coverage under, and shall pay the premiums with respect to, long term care insurance in accordance with the terms, and subject to the conditions, as the Employer shall provide to other senior executive officers.  The Executive acknowledges that this benefit shall be subject to the continued availability of such long term care insurance from the insurer under which this benefit is provided to other senior executives from time to time.

(f)            REIMBURSEMENT OF EXPENSES.  The Executive shall be reimbursed, upon submission of appropriate vouchers and supporting documentation, for all travel, entertainment and other out-of-pocket expenses reasonably and necessarily incurred by the Executive in the performance of his duties hereunder and shall be entitled to attend seminars, conferences and meetings relating to the business of the Employer consistent with the Employer’s established policies in that regard; provided that such reimbursement will be made as soon as practicable and, when taxable to the Executive, shall be made no later than the end of the calendar year following the year in which the expenses or other charges were incurred.

(g)           OTHER BENEFITS.  The Executive shall be entitled to all benefits specifically established for him and, when and to the extent he is eligible therefor, to participate in all plans and benefits generally accorded to senior executives of the Employer, including, but not limited to the following to the extent provided, if at all, to other senior executives of the Employer:  pension; profit-sharing; employee stock ownership plan; supplemental retirement; incentive compensation; bonus; disability income; split-dollar life insurance; group life; health, medical (including dental, vision and prescription drug insurance, if any) and hospitalization insurance; long term care insurance; and similar or comparable plans, and also to perquisites extended to similarly situated senior executives; provided, however, that such plans, benefits and perquisites shall be no less than those made available to all other employees of the Employer.

(h)           WITHHOLDING.  The Employer shall be entitled to withhold from amounts payable to the Executive hereunder, any federal, state or local withholding or other taxes or charges which it is from time to time required to withhold.  The Employer shall be entitled to rely upon the opinion of its legal counsel with regard to any question concerning the amount or requirement of any such withholding.

4.             CONFIDENTIALITY AND LOYALTY.  The Executive acknowledges that heretofore or hereafter during the course of his employment he has produced and may hereafter produce and have access to material, records, data, trade secrets and information not generally available to the public (collectively, “Confidential Information”) regarding the Employer and its subsidiaries and affiliates.  Accordingly, during and subsequent to termination of this Agreement, the Executive shall hold in confidence and not directly or indirectly disclose, use, copy or make lists of any such Confidential Information, except to the extent that such information is or thereafter becomes lawfully available from public sources, or such disclosure is

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authorized in writing by the Employer, required by a law or any competent administrative agency or judicial authority, or otherwise as reasonably necessary or appropriate in connection with performance by the Executive of his duties hereunder.  All records, files, documents and other materials or copies thereof relating to the Employer’s business which the Executive shall prepare or use, shall be and remain the sole property of the Employer, shall not be removed from the Employer’s premises without its written consent, and shall be promptly returned to the Employer upon termination of the Executive’s employment hereunder.  The Executive agrees to abide by the Employer’s reasonable policies, as in effect from time to time, respecting avoidance of interests conflicting with those of the Employer.  In the event of any violation or threatened violation of these restrictions, the Employer, in addition to and not in limitation of being relieved of all further obligations under this Agreement and of any other rights, remedies or damages available to the Employer under this Agreement or otherwise at law or in equity, shall be entitled to preliminary and permanent injunctive relief to prevent or restrain any such violation by the Executive and any and all persons directly or indirectly acting for or with him, as the case may be.

5.             TERMINATION.  The Executive’s employment during the term of this Agreement may be terminated by the Employer or the Executive without any breach of this Agreement only under the circumstances described in this Section 5 (where such termination constitutes a “separation from service” pursuant to Code Section 409A):

(a)AGREEMENT NON-EXTENSION OR EMPLOYMENT TERMINATION BY THE EMPLOYER AND TERMINATION BY THE EXECUTIVE.

(i)            In the event of the termination of the Executive’s employment under this Agreement by the Employer prior to the last day of the then current term for any reason other than a termination in accordance with the provisions of paragraph (c) of this Section 5 (TERMINATION FOR CAUSE), the Employer shall pay the Executive a lump sum payment equal to the sum of the amount of his Base Salary payable for the remainder of the current term, plus the amount of the Executive’s annual Bonus(es) payable for the remainder of the current term based on an amount equal to the average of his most recent three (3) years’ annual Bonus amounts.  Such payment shall be paid to the Executive within thirty (30) days of the Executive’s termination of employment.  In addition, the Employer shall continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to his termination of employment under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement, provided, however, that the payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of termination.  In the event of a non—extension of this Agreement by the Employer in accordance with the provisions of Section 1, the Employer shall:  (A) continue to pay the Executive the Base Salary then payable to the Executive pursuant to the Employer’s standard payroll practice; (B) continue to pay the Executive an annual Bonus in an amount equal to the average of his most recent three (3) years’ annual Bonus amounts pursuant to the Employer’s standard Bonus payment practices; and (C)  continue to provide coverage for the Executive at the same or equivalent level as the Executive’s

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coverage prior to the non-extension under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement, provided, however, that in the circumstance where the term of this Agreement is not extended, the Executive must remain employed with the Employer to receive such payments and benefits; further provided, that the continued payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of the notice of non-extension.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive:  (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(ii)           In the event that the Executive elects to terminate his employment under this Agreement for any reason other than a termination in accordance with the provisions of paragraph (b) (CONSTRUCTIVE DISCHARGE) or (e) (CHANGE IN CONTROL) of this Section 5, the Employer shall pay the Executive a lump sum amount equal to eighteen (18) times the sum of:  (A) the monthly Base Salary then payable to the Executive; plus (B) one twelfth (1/12) of the base annual deferred compensation contribution made by the Employer under the Deferred Compensation Plan for the year prior to the Executive’s termination.  Payment to the Executive will be made within thirty (30) days of such termination.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive:  (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(iii)          Unless a Change in Control shall have occurred, if the Employer is not in compliance with its minimum capital requirements or if the payments required under subparagraph (i) or (ii) above would cause the Employer’s capital to be reduced below its

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minimum capital requirements, such payments shall be deferred, as permitted pursuant to Code Section 409A, until such time as the Employer is in capital compliance.

(b)           CONSTRUCTIVE DISCHARGE.  If at any time during the term of this Agreement, except in connection with a termination pursuant to paragraph (c) (TERMINATION FOR CAUSE) of this Section 5, the Executive is Constructively Discharged (as hereinafter defined) then the Executive shall have the right, by written notice to the Employer within sixty (60) days of the initial existence of such Constructive Discharge condition, to terminate his services hereunder, effective as of the thirtieth (30th) day after such notice, and the Executive shall have no rights or obligations under this Agreement other than as provided in Sections 4 and 8 hereof; provided, however, the Employer shall have thirty (30) days from the date of such notice in which to cure the condition giving rise to a Constructive Discharge, if curable.  If, during such thirty (30) day period, the Employer cures the condition giving rise to Constructive Discharge, then the Executive’s notice of termination hereunder shall not be effective, the Executive’s employment shall continue until otherwise terminated under this Agreement, and no benefits shall be due under this Agreement with respect to such occurrence.  If the Employer fails to cure the condition giving rise to Constructive Discharge within such thirty (30) day period, the Executive shall be entitled to a lump sum payment of compensation and benefits and continuation of all plans and benefits as if such termination of his employment was pursuant to subparagraph (a)(i) of this Section 5 to be paid within thirty (30) days of the Executive’s termination of employment.

(i)            For purposes of this Agreement, the Executive shall be “Constructively Discharged” upon the occurrence of any one of the following events:

(A)          The Executive is not re-elected or is removed from the positions with the Employer or any affiliate set forth in Section 1 hereof, other than as a result of the Executive’s election or appointment to positions of equal or superior scope and responsibility; or

(B)           The Executive shall fail to be vested by the Employer with the powers and authority of his appointed office; or

(C)           The Employer changes the primary employment location of the Executive to a place that is more than thirty (30) miles from the primary employment location as of the Effective Date of this Agreement; or

(D)          The Employer otherwise commits a material breach of its obligations under this Agreement.

(c)           TERMINATION FOR CAUSE.  The Executive’s employment hereunder may be terminated for Cause (as hereinafter defined).  “Cause” shall mean:  (i) the Executive’s death; (ii) a material violation by the Executive of any applicable material law or regulation respecting the business of the Employer; (iii) the Executive being found guilty of a felony or an act of dishonesty in connection with the performance of his duties as an officer of the Employer, or which disqualifies the Executive from serving as an officer or director of the Employer; or (iv) the willful or negligent failure of the Executive to perform his duties hereunder in any material respect.  The Executive’s employment under this Agreement may be terminated

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immediately for any Cause except under (iv) above.  The Executive shall be entitled to at least thirty (30) days’ prior written notice of the Employer’s intention to terminate his employment under (iv) above, specifying the grounds for such termination, a reasonable opportunity to cure any conduct or act, if curable, alleged as grounds for such termination, and a reasonable opportunity to present to the Board his position regarding any dispute relating to the existence of such Cause.  Upon the Executive’s termination for Cause, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of:  (A) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (B) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (C) all accrued and unused sick days; and (D) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(d)           TERMINATION UPON DEATH.  Upon the Executive’s death, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of:  (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the date of death; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) all accrued and unused sick days; and (iv) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments as are provided under the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his death.  Payment shall be made to such beneficiary as the Executive may designate in writing, or failing such designation, to the executor of his estate, in full settlement and satisfaction of all claims and demands on behalf of the Executive.  Such payments shall be in full settlement and satisfaction of all payments provided for in this Agreement.

(e)           TERMINATION UPON CHANGE IN CONTROL.

(i)            In the event of a Change in Control and the termination of the Executive’s employment under either (A) or (B) below, the Executive shall be entitled to a lump sum payment equal to three (3) times the sum of the following:  (w) his annual Base Salary then payable; plus (x) the average of his most recent three (3) years’ annual Deferred Compensation Plan contributions; plus (y) the average of his most recent three (3) years’ Employer contributions to all Employer-sponsored tax-qualified retirement plans; plus (z) the average of his most recent three (3) years’ annual Bonuses.  The payment of such lump sum shall be paid to the Executive within thirty (30) days of his termination of employment.  In the event of a Change in Control, the Employer shall also provide the Executive with the benefits contemplated in

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subparagraph (ii) of paragraph (g) (CERTAIN INSURANCE BENEFITS) of this Section 5 below and, upon termination of the Executive’s employment under either (A) or (B) below, shall pay the Executive, within thirty (30) days of termination:  (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies on reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.  If the Executive’s employment has terminated prior to the Change in Control in accordance with the terms of this Agreement and the Employer has made all required payments under any other applicable provision of this Section 5, then no amount shall be paid under this paragraph (e).  Either of the following shall constitute termination under this paragraph:

(A)          The Executive terminates his employment by a written notice to that effect delivered to the Employer within twenty-four (24) months after the Change in Control.

(B)           The Executive’s employment under this Agreement is terminated by the Employer either in contemplation of or after the Change in Control.

(ii)           Notwithstanding the preceding paragraphs of this Section 5 and except as provided in this subparagraph (ii), in the event that it shall be determined that any payment, benefit or other entitlement under this Agreement and any other plan or arrangement of the Employer or the Bank (the “Total Payments”) would constitute an “Excess Parachute Payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and thereby be subject to the excise tax imposed by Section 4999 of the Code or any similar successor provision or any interest or penalties with respect to such excise tax (collectively the “Excise Tax”), then, except in the case of a de Minimus Excess Amount (as defined below), the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes imposed upon the Gross-Up Payment (including any federal, state and local income, payroll and excise taxes and any interest or penalties imposed with respect to such taxes), the Executive retains an amount of the Gross Up Payment equal to the Excise Tax imposed upon the Total Payments (not including any Gross-Up Payment).  Such Gross-Up Payment shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the Excise Tax.  If, at a later date, the Internal Revenue Service assesses a deficiency against the Executive for the Excise Tax which is greater than that which was determined at the time such amounts were paid, then the Employer shall pay to the Executive the amount of such unreimbursed Excise Tax plus any interest, penalties and reasonable professional fees or expenses incurred by the Executive as a result of such assessment, including all such taxes with respect to any such additional amount,which amounts shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits

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the deficient Excise Tax.  The highest marginal tax rate applicable to individuals at the time of the payment of such amounts will be used for purposes of determining the federal and state income and other taxes with respect thereto.  The Employer shall withhold from any amounts paid under this Agreement the amount of any Excise Tax or other federal, state or local taxes then required to be withheld.  Computations of the amount of the Gross-Up Payment paid under this subparagraph shall be conclusively made by the Employer’s independent accountants, in consultation, if necessary, with the Employer’s independent legal counsel.  If, after the Executive receives any Gross-Up Payment or other amount pursuant to this subparagraph, the Executive receives any refund with respect to the Excise Tax, the Executive shall promptly pay the Employer the amount of such refund within ten (10) days of receipt by the Executive.  Notwithstanding the foregoing, in the event that the amount by which the present value of the Total Payments which would constitute an Excess Parachute Payment is less than two percent (2%) of the Total Payments, then such Excess Parachute Payment shall be deemed to be a “de Minimus Excess Amount” and the Executive shall not be entitled to a Gross-Up Payment.  In such a case, the Total Payments will be reduced to an amount (the “Non-Triggering Amount”), the value of which is one dollar ($1.00) less than an amount equal to three (3) times the Executive’s “base amount,” as determined in accordance with Code Section 280G; provided, however, that such reduction shall not be made unless the Non-Triggering Amount would be greater than the aggregate value of the Total Payments (without such reduction) minus the amount of Excise Tax required to be paid by the Executive thereon.  The allocation of the reduction required by the preceding sentence shall be determined by the Executive and the Executive shall notify the Employer in writing of the allocation; provided, however, that if the Executive fails to notify the Employer, then the Employer shall make the allocation; and provided further, however, that any such allocation shall not be effective where it would result in an imposition of additional income tax under Code Section 409A.

(iii)          For purposes of this Agreement, the term “Change in Control” shall mean any of the following:

(A)          The consummation of the acquisition by any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Employer or the Bank; or

(B)           The individuals who, as of the date hereof, are members of the Board of the Employer or the Bank cease for any reason to constitute a majority of the Board, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of a majority of the Board, and such new director shall, for purposes of this Agreement, be considered as a member of the Board; or

(C)           Consummation by the Employer or the Bank of:  (1) a merger or consolidation if the shareholders immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then

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outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of the Employer or the Bank outstanding immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of the Employer or the Bank.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Employer or the Bank is acquired by:  (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the Employer or the Bank; or (2) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders in the same proportion as their ownership of stock of the Employer or the Bank immediately prior to such acquisition.

(f)            REGULATORY SUSPENSION AND TERMINATION.

(i)            If the Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Employer’s affairs by a notice served under Section 8(e)(3) (12 U.S.C. Section 1818(e)(3)) or 8(g) (12 U.S.C. Section 1818(g)) of the Federal Deposit Insurance Act, as amended, the Employer’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 Employer shall:  (A) pay the Executive all of the compensation withheld while the contract obligations were suspended; and (B) reinstate any of the obligations which were suspended.

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

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

(iv)          All obligations of the Employer under this contract shall be terminated, except to the extent determined that continuation of the contract is necessary for the continued operation of the institution by the Federal Deposit Insurance Corporation (the “FDIC”), at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Employer under the authority contained in Section 13(c) (12 U.S.C. Section 1823(c)) of the Federal Deposit Insurance Act, as amended, or when the Employer is determined by the FDIC 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.

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(v)           Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with Section 18(k) (12 U.S.C. Section 1828(k)) of the Federal Deposit Insurance Act as amended, and any regulations promulgated thereunder.

(g)           CERTAIN INSURANCE BENEFITS.

(i)            In the event of the termination of the Executive’s employment under this Agreement due to “retirement” (as hereinafter defined), the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death:  (A) continuing coverage for the Executive and the Executive’s Spouse under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination); and (B) long term care insurance in accordance with paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.  The term “retirement” for purposes of this paragraph (g) shall mean the Executive:  (a) terminates employment at or after the attainment of age 62; and (b) does not engage in any form of gainful employment on or after his termination of employment.  The continued coverage under this subparagraph (g)(i) shall be for benefits at a level equivalent to the Executive’s benefits at the time of the Executive’s termination of employment. The continued coverage under this subparagraph (g)(i) shall terminate upon the Executive’s engaging in any gainful employment on or after his termination of employment.

(ii)           After the occurrence of a Change in Control, the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death:  (A) continuing coverage that is equivalent to the coverage provided under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination) maintained by the Employer at the time of the Change in Control; and (B) long term care insurance in accordance with paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.

(iii)          In the event of the termination of the Executive’s employment under this Agreement other than as contemplated above in this paragraph (g) or pursuant to paragraph (c) (TERMINATION FOR CAUSE) of Section 5 above, at the election of the Executive (including the estate of the Executive) and the Executive’s Spouse and provided such action is not prohibited by the policy pursuant to which the Executive receives the benefit contemplated in paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above, the Employer shall take all actions necessary, including, but not limited to, a transfer and assignment of its interests in the long term health insurance provided to the Executive pursuant to paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above, in order to facilitate the ability of the Executive and the Executive’s Spouse to continue to maintain the long term health insurance at no additional cost to the Employer.

(iv)          The payment of premiums for insurance benefits listed in this paragraph (g) shall be remitted to the appropriate carrier no later than thirty (30) days following receipt of the applicable premium invoice.

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6.             PAYMENT UPON DISABILITY.  If during the term of this Agreement the Executive is deemed to have a Disability (as hereinafter defined), the Employer shall provide the Executive with the payments and benefits set forth in this Section 6.  “Disability,” for purposes of this Agreement shall mean that:  (i) the Executive is unable to engage in any substantial gainful activity by reason of 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; or (ii) the Executive is, by reason of 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, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Employer.  The Executive shall be entitled to the compensation and benefits provided for under this Agreement for any period during the term of this Agreement and prior to the establishment of the Executive’s Disability during which the Executive is unable to work due to a physical or mental infirmity.  If the Executive is determined to have a Disability, the Employer shall continue to pay the Executive eighty percent (80%) of the Base Salary per month then payable to the Executive, reduced by any amounts received under the Employer sponsored disability income insurance program, and shall continue to provide coverage for the Executive under the health and life insurance programs maintained by the Employer by the payment of applicable premiums in accordance with the Employer’s standard payment practice until the earlier of the date the Executive returns to full-time employment, either with the Employer or another employer, or the Executive’s normal retirement age under the Social Security Act, as amended.  In addition, if the Executive’s employment is terminated following his Disability, the Employer shall pay the Executive, within thirty (30) days of termination, (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) for all accrued and unused sick days; and (iv) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his termination.  Notwithstanding any other provision of this Agreement, in the event of the termination of the Executive’s employment under this Agreement for any reason, if permitted by law, the Executive may elect to have any disability income insurance policy maintained by the Employer on his behalf transferred to him, and he shall assume all obligations thereunder.

7.             INTEREST IN ASSETS.  Neither the Executive nor his estate shall acquire hereunder any rights in funds or assets of the Employer, otherwise than by and through the actual payment of amounts payable hereunder; nor shall the Executive or his estate have any power to transfer, assign, anticipate, hypothecate or otherwise encumber in advance any of said payments; nor shall any of such payments be subject to seizure for the payment of any debt, judgment, alimony, separate maintenance or be transferable by operation of law in the event of bankruptcy, insolvency or otherwise of the Executive.

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8.             INDEMNIFICATION.

(a)           INSURANCE.  The Employer shall provide the Executive (including his heirs, personal representatives, executors and administrators) for the term of this Agreement with coverage under a standard directors’ and officers’ liability insurance policy at its expense.

(b)           INDEMNIFICATION UNDER STATE LAW.  In addition to the insurance coverage provided for in paragraph (a) of this Section 8, the Employer shall hold harmless and indemnify the Executive (and his heirs, executors and administrators) to the fullest extent permitted under applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been an officer of the Employer (whether or not he continues to be an officer at the time of incurring such expenses or liabilities), such expenses and liabilities to include, but not be limited to, judgments, court costs and attorneys’ fees and the cost of reasonable settlements.

(c)           ADVANCEMENT OF EXPENSES.  In the event the Executive becomes a party, or is threatened to be made a party, to any action, suit or proceeding for which the Employer has agreed to provide insurance coverage or indemnification under this Section 8, the Employer shall, to the full extent permitted under applicable law, advance all expenses (including reasonable attorneys’ fees), judgments, fines and amounts paid in settlement (collectively “Expenses”) incurred by the Executive in connection with the investigation, defense, settlement, or appeal of any threatened, pending or completed action, suit or proceeding, subject to receipt by the Employer of a written undertaking from the Executive:  (i) to reimburse the Employer for all Expenses actually paid by the Employer to or on behalf of the Executive in the event it shall be ultimately determined that the Executive is not entitled to indemnification by the Employer for such Expenses; and (ii) to assign to the Employer all rights of the Executive to indemnification, under any policy of directors’ and officers’ liability insurance or otherwise, to the extent of the amount of Expenses actually paid by the Employer to or on behalf of the Executive.

9.             GENERAL PROVISIONS.

(a)           SUCCESSORS.  This Agreement is personal to the Executive and shall not be assignable by the Executive other than by will or the laws of descent and distribution.  This Agreement shall inure to the benefit of and be enforceable by the Executive’s designated beneficiary, or if none, the Executive’s estate.  This Agreement shall be binding upon and inure to the benefit of the Employer and its successors, and any successor of the Employer shall be deemed the “Employer” hereunder.  The Employer shall require any successor to all or substantially all of the business and/or assets of the Employer, whether directly or indirectly, by purchase, merger, consolidation, acquisition of stock, other business combination, or otherwise, by a written agreement in form and substance satisfactory to the Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same extent as the Employer would be required to perform if no such succession had taken place.

(b)           ENTIRE AGREEMENT; MODIFICATIONS.  This Agreement, along with the Amended and Restated Life Insurance Agreement and the Participation Agreement under the Deferred Compensation Plan, constitutes the entire agreement between the parties respecting the subject

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matter hereof, and supersedes all prior employment agreements and all prior negotiations, undertakings, agreements and arrangements with respect hereto, whether written or oral. Except as otherwise explicitly provided herein, this Agreement may not be amended or modified except by written agreement signed by the Executive and the Employer.

(c)           ENFORCEMENT AND GOVERNING LAW.  The provisions of this Agreement shall be regarded as divisible and separate; if any of said provisions should be declared invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remaining provisions shall not be affected thereby.  This Agreement shall be construed and the legal relations of the parties hereto shall be determined in accordance with the laws of the State of Illinois without reference to the law regarding conflicts of law.

(d)           ARBITRATION.  Any dispute or controversy arising under or in connection with this Agreement or the Executive’s employment by the Employer shall be settled exclusively by arbitration, conducted by a single arbitrator sitting in a location selected by the Executive within fifty (50) miles of the main office of the Employer, in accordance with the rules of JAMS/Endispute (“JAMS”) then in effect.  The arbitrator shall be selected by the parties from a list of arbitrators provided by JAMS, provided that no arbitrator shall be related to or affiliated with either of the parties.  No later than ten (10) days after the list of proposed arbitrators is received by the parties, the parties, or their respective representatives, shall meet at a mutually convenient location or telephonically.  At that meeting, the party who sought arbitration shall eliminate one (1) proposed arbitrator and then the other party shall eliminate one (1) proposed arbitrator.  The parties shall continue to eliminate names from the list of proposed arbitrators in this manner until a single proposed arbitrator remains.  This remaining arbitrator shall arbitrate the dispute.  Each party shall submit, in writing, the specific requested action or decision it wishes to take, or make, with respect to the matter in dispute, and the arbitrator shall be obligated to choose one (1) party’s specific requested action or decision, without being permitted to effectuate any compromise position.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that the Executive shall be entitled to seek specific performance of his right to be paid through the date of termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

(e)           LEGAL FEES.  All reasonable legal fees paid or incurred by the Executive pursuant to any dispute or question of interpretation relating to this Agreement shall be paid or reimbursed by the Employer if the Executive is successful on the merits pursuant to a legal judgment, arbitration or settlement.  The Employer shall make any required payment under this paragraph (e) as soon as practicable following the time at which such expense and/or fee is incurred, but in no event later than December 31 of the year following the year in which the expense and/or fee is incurred by the Executive.

(f)            SURVIVAL.  The provisions of Sections 4 and 8 shall survive the termination of this Agreement.

(g)           WAIVER.  No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by the other party, shall be deemed a waiver of any similar or dissimilar provisions or conditions at the same time or any prior or subsequent time.

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(h)           NOTICES.  Notices pursuant to this Agreement shall be in writing and shall be deemed given when received; and, if mailed, shall be mailed by United States registered or certified mail, return receipt requested, postage prepaid; and if to the Employer, addressed to the principal headquarters of the Employer, attention:  Chairman; or, if to the Executive, to the address set forth below the Executive’s signature on this Agreement, or to such other address as the party to be notified shall have given to the other.

(i)            INTERNAL REVENUE CODE SECTION 409A.

(i)            To the extent that any of the terms and conditions contained herein constitute an amendment or modification of the time or manner of payment under a non-qualified deferred compensation plan (as defined under Code Section 409A), then to the extent necessary under the transitional guidance under Internal Revenue Service Notice 2007-86, this Agreement, as amended, constitutes an amendment to, and a new election under, such deferred compensation plan, in order to properly modify the time or manner of payment consistent with such guidance.

(ii)           It is intended that the Agreement shall comply with the provisions of Code Section 409A so as not to subject the Executive to the payment of additional taxes and interest under Code Section 409A.  In furtherance of this intent, this Agreement shall be interpreted, operated and administered in a manner consistent with these intentions, and to the extent that any regulations or other guidance issued under Code Section 409A would result in the Executive being subject to payment of additional income taxes or interest under Code Section 409A, the parties agree to amend the Agreement to maintain to the maximum extent practicable the original intent of the Agreement while avoiding the application of such taxes or interest under Code Section 409A.

(iii)          Notwithstanding any provision in the Agreement to the contrary if, as of the effective date of the Executive’s termination of employment, he is a Specified Employee (as hereinafter defined), then, only to the extent required pursuant to Code Section 409A(a)(2)(B)(i), payments due under this Agreement which are deemed to be deferred compensation shall be subject to a six (6) month delay following the Executive’s separation from service.  For purposes of Code Section 409A, all installment payments of deferred compensation made hereunder, or pursuant to another plan or arrangement, shall be deemed to be separate payments and, accordingly, the aforementioned deferral shall only apply to separate payments which would occur during the six (6) month deferral period and all other payments shall be unaffected.  All delayed payments shall be accumulated and paid in a lump-sum catch-up payment as of the first day of the seventh-month following separation from service (or, if earlier, the date of death of the Executive) with all such delayed payments being credited with interest (compounded monthly) for this period of delay equal to the prime rate in effect on the first day of such six-month period.  Any portion of the benefits hereunder that were not otherwise due to be paid during the six-month period following the termination shall be paid to the Executive in accordance with the payment schedule established herein.

(iv)          The term “Specified Employee” shall mean any person who is a “key employee” (as defined in Code Section 416(i) without regard to paragraph (5) thereof), as determined by the Employer based upon the 12-month period ending on each December 31st (such 12-month period is referred to below as the “identification period”).  If the Executive is

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determined to be a key employee under Code Section 416(i) (without regard to paragraph (5) thereof) during the identification period he shall be treated as a Specified Employee for purposes of this Agreement during the 12-month period that begins on the April 1 following the close of such identification period.  For purposes of determining whether the Executive is a key employee under Code Section 416(i), “compensation” shall mean the Executive’s W-2 compensation as reported by the Employer for a particular calendar year.

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

WEST SUBURBAN BANCORP, INC.		KEVIN J. ACKER
By:	/s/ Duane G. Debs	/s/ Kevin J. Acker
Name:	Duane Debs
Title:	President
		(Address)

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EX-10.3

Exhibit 10.3

WEST SUBURBAN BANCORP, INC.

RESTATED EMPLOYMENT AGREEMENT – KEITH W. ACKER

This RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), is made and entered into as of the 29th day of December, 2008 (the “Effective Date”), by and between WEST SUBURBAN BANCORP, INC., an Illinois corporation (the “Employer”), and KEITH W. ACKER, an Illinois resident (the “Executive”).

R E C I T A L S:

A.            The Employer owns all of the issued and outstanding capital stock of West Suburban Bank, Lombard, Illinois (the “Bank”).

B.             The Employer desires to continue to employ the Executive as an officer of the Employer and of the Bank for a specified term and the Executive is willing to continue such employment upon the terms and conditions hereinafter set forth.

C.             Additionally, the Employer recognizes that circumstances may arise which may result in a change in control of the Employer and/or the Bank (through acquisition or otherwise) thereby causing uncertainty with respect to the Executive’s employment without regard to the competence or past contributions of the Executive and that such uncertainty may result in the loss to the Employer and/or the Bank of the valuable services provided by the Executive.  In such circumstances, the Employer and the Executive wish to provide reasonable security to the Executive against changes in the Executive’s employment relationship with the Employer and/or the Bank.

D.            The Executive currently serves as the Vice President and Chief Operating Officer of Employer and the President and a Trust Officer of the Bank pursuant to that certain Employment Agreement dated March 8, 2004, as amended (the “Employment Agreement”).

E.             The parties desire to amend and restate the Employment Agreement in accordance with the terms, and subject to the conditions, set forth herein in order to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the related U.S. Treasury Department regulations and guidance promulgated thereunder (“Code Section 409A”).

NOW, THEREFORE, in consideration of the promises and of the covenants and agreements hereinafter contained, it is covenanted and agreed by and between the parties hereto as follows:

A G R E E M E N T S:

1.             TERM OF EMPLOYMENT WITH AUTOMATIC RENEWAL PROVISIONS.  The period of the Executive’s employment under this Agreement shall be deemed to have commenced on the Effective Date and shall continue for a period of approximately three (3) years through December 31, 2011.  The term of employment of the Executive under this Agreement shall automatically be extended for one (1) additional year

on December 31st of each year beginning December 31, 2009, unless either the Employer or the Executive notifies the other party, by written notice delivered no later than November 1st of such year, that the term of employment of the Executive under this Agreement shall not be extended for an additional year.  In addition, upon the occurrence of a Change in Control (as defined below), the term of employment of the Executive under this Agreement shall be automatically renewed and extended to provide a term of employment (in accordance with the terms, and subject to the conditions, set forth herein) equal to a period of three (3) years from the date of the consummation of the Change in Control.

2.             POSITION AND DUTIES.  The Employer hereby continues to employ the Executive as the Vice President and Chief Operating Officer of the Employer and as the President of the Bank or in such other senior executive capacity as shall be mutually agreed between the Employer and the Executive.  During the period of the Executive’s employment hereunder, the Executive shall devote his best efforts and full business time, energy, skills and attention to the business and affairs of the Employer and its affiliates, including the Bank.  The Executive’s duties and authority shall consist of and include all duties and authority customarily performed and held by persons holding equivalent positions with business organizations similar in nature and size to the Employer, as such duties and authority are reasonably defined, modified and delegated from time to time by the Board of Directors of the Employer (the “Board”).  The Executive shall have the powers necessary to perform the duties assigned to him and shall be provided such supporting services, staff and other assistance, office space and accoutrements as shall be reasonably necessary and appropriate in the light of such assigned duties.

3.             COMPENSATION.  As compensation for the services to be provided by the Executive hereunder, the Executive shall receive the following compensation, expense reimbursement and other benefits:

(a)           BASE SALARY.  The Executive shall receive an aggregate annual minimum base salary at the rate of three hundred three thousand five hundred seventy five and 48/100 dollars ($303,575.48) payable in installments in accordance with the regular payroll schedule of the Bank (“Base Salary”).  Such Base Salary shall be subject to review annually commencing in 2009 and shall be maintained or increased during the term hereof in accordance with the Employer’s established management compensation policies and practices.

(b)           BONUS.  The Executive shall be eligible for an annual bonus (“Bonus”) with respect to each fiscal year of the Employer in accordance with the Employer’s compensation and bonus policies and practices for senior executive officers.  The amount of the Bonus, if any, shall be determined by the Compensation Committee of the Board (the “Compensation Committee”).  The Bonus, if any, shall be paid no later than March 15th of the year following the calendar year in which the Bonus is earned.

(c)           CLUB MEMBERSHIP.  The Executive shall be reimbursed for membership dues and other customary charges at the Medinah Country Club incurred by the Executive.  Any such reimbursement shall be made no later than the end of the calendar year following the year in which the dues or other charges were incurred.

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(d)           DEFERRED COMPENSATION.  The Employer shall make contributions for the benefit of the Executive to the Employer’s Directors and Senior Management Deferred Compensation Plan (“Deferred Compensation Plan”), including any successor plan or program thereto, in an annual amount of not less than twenty-five thousand dollars ($25,000).

(e)           VACATIONS.  The Executive shall receive paid vacation days of at least such number of paid vacation days as the Executive shall be entitled to receive as of the date hereof in accordance with the Employer’s vacation policy in effect as of the date hereof.  The method of accrual, forfeiture and scheduling of vacation days shall be in accordance with, and subject to, the Employer’s general vacation policies and practices.

(f)            LONG TERM CARE INSURANCE.  The Employer shall provide the Executive and the Executive’s spouse with coverage under, and shall pay the premiums with respect to, long term care insurance in accordance with the terms, and subject to the conditions, as the Employer shall provide to other senior executive officers.  The Executive acknowledges that this benefit shall be subject to the continued availability of such long term care insurance from the insurer under which this benefit is provided to other senior executives from time to time.

(g)           REIMBURSEMENT OF EXPENSES.  The Executive shall be reimbursed, upon submission of appropriate vouchers and supporting documentation, for all travel, entertainment and other out-of-pocket expenses reasonably and necessarily incurred by the Executive in the performance of his duties hereunder and shall be entitled to attend seminars, conferences and meetings relating to the business of the Employer consistent with the Employer’s established policies in that regard; provided, that such reimbursement will be made as soon as practicable and, when taxable to the Executive, shall be made no later than the end of the calendar year following the year in which the expenses or other charges were incurred.

(h)           OTHER BENEFITS.  The Executive shall be entitled to all benefits specifically established for him and, when and to the extent he is eligible therefor, to participate in all plans and benefits generally accorded to senior executives of the Employer, including, but not limited to the following to the extent provided, if at all, to other senior executives of the Employer:  pension; profit-sharing; employee stock ownership plan; supplemental retirement; incentive compensation; bonus; disability income; split-dollar life insurance; group life; health, medical (including dental, vision and prescription drug insurance, if any) and hospitalization insurance; long term care insurance; and similar or comparable plans, and also to perquisites extended to similarly situated senior executives; provided, however, that such plans, benefits and perquisites shall be no less than those made available to all other employees of the Employer.

(i)            WITHHOLDING.  The Employer shall be entitled to withhold from amounts payable to the Executive hereunder, any federal, state or local withholding or other taxes or charges which it is from time to time required to withhold.  The Employer shall be entitled to rely upon the opinion of its legal counsel with regard to any question concerning the amount or requirement of any such withholding.

4.             CONFIDENTIALITY AND LOYALTY.  The Executive acknowledges that heretofore or hereafter during the course of his employment he has produced and may hereafter produce and have access to material, records, data, trade secrets and information not generally

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available to the public (collectively, “Confidential Information”) regarding the Employer and its subsidiaries and affiliates.  Accordingly, during and subsequent to termination of this Agreement, the Executive shall hold in confidence and not directly or indirectly disclose, use, copy or make lists of any such Confidential Information, except to the extent that such information is or thereafter becomes lawfully available from public sources, or such disclosure is authorized in writing by the Employer, required by a law or any competent administrative agency or judicial authority, or otherwise as reasonably necessary or appropriate in connection with performance by the Executive of his duties hereunder.  All records, files, documents and other materials or copies thereof relating to the Employer’s business which the Executive shall prepare or use, shall be and remain the sole property of the Employer, shall not be removed from the Employer’s premises without its written consent, and shall be promptly returned to the Employer upon termination of the Executive’s employment hereunder.  The Executive agrees to abide by the Employer’s reasonable policies, as in effect from time to time, respecting avoidance of interests conflicting with those of the Employer.  In the event of any violation or threatened violation of these restrictions, the Employer, in addition to and not in limitation of being relieved of all further obligations under this Agreement and of any other rights, remedies or damages available to the Employer under this Agreement or otherwise at law or in equity, shall be entitled to preliminary and permanent injunctive relief to prevent or restrain any such violation by the Executive and any and all persons directly or indirectly acting for or with him, as the case may be.

5.             TERMINATION.  The Executive’s employment during the term of this Agreement may be terminated by the Employer or the Executive without any breach of this Agreement only under the circumstances described in this Section 5 (where such termination constitutes a “separation from service” pursuant to Code Section 409A):

(a)AGREEMENT NON-EXTENSION OR EMPLOYMENT TERMINATION BY THE EMPLOYER AND TERMINATION BY THE EXECUTIVE.

(i)            In the event of the termination of the Executive’s employment under this Agreement by the Employer prior to the last day of the then current term for any reason other than a termination in accordance with the provisions of paragraph (c) of this Section 5 (TERMINATION FOR CAUSE), the Employer shall pay the Executive a lump sum payment equal to the sum of the amount of his Base Salary payable for the remainder of the current term, plus the amount of the Executive’s annual Bonus(es) payable for the remainder of the current term based on an amount equal to the average of his most recent three (3) years’ annual Bonus amounts.  Such payment shall be paid to the Executive within thirty (30) days of the Executive’s termination of employment.  In addition, the Employer shall continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to his termination of employment under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement, provided, however, that the payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of termination.  In the event of a non—extension of this Agreement by the Employer in accordance with the provisions

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of Section 1, the Employer shall: (A) continue to pay the Executive the Base Salary then payable to the Executive pursuant to the Employer’s standard payroll practice; (B) continue to pay the Executive an annual Bonus in an amount equal to the average of his most recent three (3) years’ annual Bonus amounts pursuant to the Employer’s standard Bonus payment practices; and (C) continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to the non-extension under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement; provided, however, that in the circumstance where the term of this Agreement is not extended, the Executive must remain employed with the Employer to receive such payments and benefits; further provided, that the continued payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of the notice of non-extension.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(ii)           In the event that the Executive elects to terminate his employment under this Agreement for any reason other than a termination in accordance with the provisions of paragraph (b) (CONSTRUCTIVE DISCHARGE) or (e) (CHANGE IN CONTROL) of this Section 5, the Employer shall pay the Executive a lump sum amount equal to eighteen (18) times the sum of: (A) the monthly Base Salary then payable to the Executive; plus (B) one twelfth (1/12) of the base annual deferred compensation contribution made by the Employer under the Deferred Compensation Plan for the year prior to the Executive’s termination.  Payment to the Executive will be made within thirty (30) days of such termination.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

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(iii)          Unless a Change in Control shall have occurred, if the Employer is not in compliance with its minimum capital requirements or if the payments required under subparagraph (i) or (ii) above would cause the Employer’s capital to be reduced below its minimum capital requirements, such payments shall be deferred, as permitted pursuant to Code Section 409A, until such time as the Employer is in capital compliance.

(b)           CONSTRUCTIVE DISCHARGE.  If at any time during the term of this Agreement, except in connection with a termination pursuant to paragraph (c) (TERMINATION FOR CAUSE) of this Section 5, the Executive is Constructively Discharged (as hereinafter defined) then the Executive shall have the right, by written notice to the Employer within sixty (60) days of the initial existence of such Constructive Discharge condition, to terminate his services hereunder, effective as of the thirtieth (30th) day after such notice, and the Executive shall have no rights or obligations under this Agreement other than as provided in Sections 4 and 8 hereof; provided, however, the Employer shall have thirty (30) days from the date of such notice in which to cure the condition giving rise to a Constructive Discharge, if curable.  If, during such thirty (30) day period, the Employer cures the condition giving rise to Constructive Discharge, then the Executive’s notice of termination hereunder shall not be effective, the Executive’s employment shall continue until otherwise terminated under this Agreement, and no benefits shall be due under this Agreement with respect to such occurrence.  If the Employer fails to cure the condition giving rise to Constructive Discharge within such thirty (30) day period, the Executive shall be entitled to a lump sum payment of compensation and benefits and continuation of all plans and benefits as if such termination of his employment was pursuant to subparagraph (a)(i) of this Section 5 to be paid within thirty (30) days of the Executive’s termination of employment.

(i)            For purposes of this Agreement, the Executive shall be “Constructively Discharged” upon the occurrence of any one of the following events:

(A)          The Executive is not re-elected or is removed from the positions with the Employer or any affiliate set forth in Section 1 hereof, other than as a result of the Executive’s election or appointment to positions of equal or superior scope and responsibility; or

(B)           The Executive shall fail to be vested by the Employer with the powers and authority of his appointed office; or

(C)           The Employer changes the primary employment location of the Executive to a place that is more than thirty (30) miles from the primary employment location as of the Effective Date of this Agreement; or

(D)          The Employer otherwise commits a material breach of its obligations under this Agreement.

(c)           TERMINATION FOR CAUSE.  The Executive’s employment hereunder may be terminated for Cause (as hereinafter defined).  “Cause” shall mean:  (i) the Executive’s death; (ii) a material violation by the Executive of any applicable material law or regulation respecting the business of the Employer; (iii) the Executive being found guilty of a felony or an act of dishonesty in connection with the performance of his duties as an officer of the Employer, or

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which disqualifies the Executive from serving as an officer or director of the Employer; or (iv) the willful or negligent failure of the Executive to perform his duties hereunder in any material respect.  The Executive’s employment under this Agreement may be terminated immediately for any Cause except under (iv) above.  The Executive shall be entitled to at least thirty (30) days’ prior written notice of the Employer’s intention to terminate his employment under (iv) above, specifying the grounds for such termination, a reasonable opportunity to cure any conduct or act, if curable, alleged as grounds for such termination, and a reasonable opportunity to present to the Board his position regarding any dispute relating to the existence of such Cause.  Upon the Executive’s termination for Cause, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of: (A) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (B) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (C) all accrued and unused sick days; and (D) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(d)           TERMINATION UPON DEATH.  Upon the Executive’s death, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of: (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the date of death; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) all accrued and unused sick days; and (iv) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments as are provided under the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his death.  Payment shall be made to such beneficiary as the Executive may designate in writing, or failing such designation, to the executor of his estate, in full settlement and satisfaction of all claims and demands on behalf of the Executive.  Such payments shall be in full settlement and satisfaction of all payments provided for in this Agreement.

(e)           TERMINATION UPON CHANGE IN CONTROL.

(i)            In the event of a Change in Control and the termination of the Executive’s employment under either (A) or (B) below, the Executive shall be entitled to a lump sum payment equal to three (3) times the sum of the following: (w) his annual Base Salary then payable plus (x) the average of his most recent three (3) years’ annual Deferred Compensation Plan contributions; plus (y) the average of his most recent three (3) years’ Employer contributions to all Employer-sponsored tax-qualified retirement plans; plus (z) the average of

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his most recent three (3) years’ annual Bonuses.  The payment of such lump sum shall be paid to the Executive within thirty (30) days of his termination of employment.  In the event of a Change in Control, the Employer shall also provide the Executive with the benefits contemplated in subparagraph (ii) of paragraph (g) (CERTAIN INSURANCE BENEFITS) of this Section 5 below and, upon termination of the Executive’s employment under either (A) or (B) below, shall pay the Executive, within thirty (30) days of termination: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies on reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.  If the Executive’s employment has terminated prior to the Change in Control in accordance with the terms of this Agreement and the Employer has made all required payments under any other applicable provision of this Section 5, then no amount shall be paid under this paragraph (e).  Either of the following shall constitute termination under this paragraph:

(A)          The Executive terminates his employment by a written notice to that effect delivered to the Employer within twenty-four (24) months after the Change in Control.

(B)           The Executive’s employment under this Agreement is terminated by the Employer either in contemplation of or after the Change in Control.

(ii)           Notwithstanding the preceding paragraphs of this Section 5 and except as provided in this subparagraph (ii), in the event that it shall be determined that any payment, benefit or other entitlement under this Agreement and any other plan or arrangement of the Employer or the Bank (the “Total Payments”) would constitute an “Excess Parachute Payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and thereby be subject to the excise tax imposed by Section 4999 of the Code or any similar successor provision or any interest or penalties with respect to such excise tax (collectively the “Excise Tax”), then, except in the case of a de Minimus Excess Amount (as defined below), the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes imposed upon the Gross-Up Payment (including any federal, state and local income, payroll and excise taxes and any interest or penalties imposed with respect to such taxes), the Executive retains an amount of the Gross Up Payment equal to the Excise Tax imposed upon the Total Payments (not including any Gross-Up Payment).  Such Gross-Up Payment shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the Excise Tax.  If, at a later date, the Internal Revenue Service assesses a deficiency against the Executive for the Excise Tax which is greater than that which was determined at the time such amounts were paid, then the Employer shall pay to the Executive the amount of such unreimbursed Excise Tax plus any interest, penalties and reasonable professional fees or

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expenses incurred by the Executive as a result of such assessment, including all such taxes with respect to any such additional amount, which amounts shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the deficient Excise Tax.  The highest marginal tax rate applicable to individuals at the time of the payment of such amounts will be used for purposes of determining the federal and state income and other taxes with respect thereto.  The Employer shall withhold from any amounts paid under this Agreement the amount of any Excise Tax or other federal, state or local taxes then required to be withheld.  Computations of the amount of the Gross-Up Payment paid under this subparagraph shall be conclusively made by the Employer’s independent accountants, in consultation, if necessary, with the Employer’s independent legal counsel.  If, after the Executive receives any Gross-Up Payment or other amount pursuant to this subparagraph, the Executive receives any refund with respect to the Excise Tax, the Executive shall promptly pay the Employer the amount of such refund within ten (10) days of receipt by the Executive.  Notwithstanding the foregoing, in the event that the amount by which the present value of the Total Payments which would constitute an Excess Parachute Payment is less than two percent (2%) of the Total Payments, then such Excess Parachute Payment shall be deemed to be a “de Minimus Excess Amount” and the Executive shall not be entitled to a Gross-Up Payment.  In such a case, the Total Payments will be reduced to an amount (the “Non-Triggering Amount”), the value of which is one dollar ($1.00) less than an amount equal to three (3) times the Executive’s “base amount,” as determined in accordance with Code Section 280G; provided, however, that such reduction shall not be made unless the Non-Triggering Amount would be greater than the aggregate value of the Total Payments (without such reduction) minus the amount of Excise Tax required to be paid by the Executive thereon.  The allocation of the reduction required by the preceding sentence shall be determined by the Executive and the Executive shall notify the Employer in writing of the allocation; provided, however, that if the Executive fails to notify the Employer, then the Employer shall make the allocation; and provided further, however, that any such allocation shall not be effective where it would result in an imposition of additional income tax under Code Section 409A.

(iii)          For purposes of this Agreement, the term “Change in Control” shall mean any of the following:

(A)          The consummation of the acquisition by any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Employer or the Bank; or

(B)           The individuals who, as of the date hereof, are members of the Board of the Employer or the Bank cease for any reason to constitute a majority of the Board, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of a majority of the Board, and such new director shall, for purposes of this Agreement, be considered as a member of the Board; or

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(C)           Consummation by the Employer or the Bank of:  (1) a merger or consolidation if the shareholders immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of the Employer or the Bank outstanding immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of the Employer or the Bank.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Employer or the Bank is acquired by:  (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the Employer or the Bank; or (2) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders in the same proportion as their ownership of stock of the Employer or the Bank immediately prior to such acquisition.

(f)            REGULATORY SUSPENSION AND TERMINATION.

(i)            If the Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Employer’s affairs by a notice served under Section 8(e)(3) (12 U.S.C. Section 1818(e)(3)) or 8(g) (12 U.S.C. Section 1818(g)) of the Federal Deposit Insurance Act, as amended, the Employer’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 Employer shall: (A) pay the Executive all of the compensation withheld while the contract obligations were suspended; and (B) reinstate any of the obligations which were suspended.

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

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

(iv)          All obligations of the Employer under this contract shall be terminated, except to the extent determined that continuation of the contract is necessary for the continued operation of the institution by the Federal Deposit Insurance Corporation (the “FDIC”), at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Employer under the authority contained in Section 13(c) (12 U.S.C. Section 1823(c)) of the Federal Deposit Insurance Act, as amended, or when the Employer is determined by the FDIC to be in an

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unsafe or unsound condition.  Any rights of the parties that have already vested, however, shall not be affected by such action.

(v)           Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with Section 18(k) (12 U.S.C. Section 1828(k)) of the Federal Deposit Insurance Act as amended, and any regulations promulgated thereunder.

(g)           CERTAIN INSURANCE BENEFITS.

(i)            In the event of the termination of the Executive’s employment under this Agreement due to “retirement” (as hereinafter defined), the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death: (A) continuing coverage for the Executive and the Executive’s Spouse under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination); and (B) long term care insurance in accordance with paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.  The term “retirement” for purposes of this paragraph (g) shall mean the Executive: (a) terminates employment at or after the attainment of age 62; and (b) does not engage in any form of gainful employment on or after his termination of employment.  The continued coverage under this subparagraph (g)(i) shall be for benefits at a level equivalent to the Executive’s benefits at the time of the Executive’s termination of employment. The continued coverage under this subparagraph (g)(i) shall terminate upon the Executive’s engaging in any gainful employment on or after his termination of employment.

(ii)           After the occurrence of a Change in Control, the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death: (A) continuing coverage that is equivalent to the coverage provided under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination) maintained by the Employer at the time of the Change in Control; and (B) long term care insurance in accordance with paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.

(iii)          In the event of the termination of the Executive’s employment under this Agreement other than as contemplated above in this paragraph (g) or pursuant to paragraph (c) (TERMINATION FOR CAUSE) of Section 5 above, at the election of the Executive (including the estate of the Executive) and the Executive’s Spouse and provided such action is not prohibited by the policy pursuant to which the Executive receives the benefit contemplated in paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above, the Employer shall take all actions necessary, including, but not limited to, a transfer and assignment of its interests in the long term health insurance provided to the Executive pursuant to paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above, in order to facilitate the ability of the Executive and the Executive’s Spouse to continue to maintain the long term health insurance at no additional cost to the Employer.

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(iv)          The payment of premiums for insurance benefits listed in this paragraph (g) shall be remitted to the appropriate carrier no later than thirty (30) days following receipt of the applicable premium invoice.

6.             PAYMENT UPON DISABILITY.   If during the term of this Agreement the Executive is deemed to have a Disability (as hereinafter defined), the Employer shall provide the Executive with the payments and benefits set forth in this Section 6.  “Disability,” for purposes of this Agreement shall mean that: (i) the Executive is unable to engage in any substantial gainful activity by reason of 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, or (ii) the Executive is, by reason of 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, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Employer.  The Executive shall be entitled to the compensation and benefits provided for under this Agreement for any period during the term of this Agreement and prior to the establishment of the Executive’s Disability during which the Executive is unable to work due to a physical or mental infirmity.  If the Executive is determined to have a Disability, the Employer shall continue to pay the Executive eighty percent (80%) of the Base Salary per month then payable to the Executive, reduced by any amounts received under the Employer sponsored disability income insurance program, and shall continue to provide coverage for the Executive under the health and life insurance programs maintained by the Employer by the payment of applicable premiums in accordance with the Employer’s standard payment practice until the earlier of the date the Executive returns to full-time employment, either with the Employer or another employer, or the Executive’s normal retirement age under the Social Security Act, as amended.  In addition, if the Executive’s employment is terminated following his Disability, the Employer shall pay the Executive, within thirty (30) days of termination: (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) for all accrued and unused sick days; and (iv) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his termination.  Notwithstanding any other provision of this Agreement, in the event of the termination of the Executive’s employment under this Agreement for any reason, if permitted by law, the Executive may elect to have any disability income insurance policy maintained by the Employer on his behalf transferred to him, and he shall assume all obligations thereunder.

7.             INTEREST IN ASSETS.  Neither the Executive nor his estate shall acquire hereunder any rights in funds or assets of the Employer, otherwise than by and through the actual payment of amounts payable hereunder; nor shall the Executive or his estate have any power to transfer, assign, anticipate, hypothecate or otherwise encumber in advance any of said payments;

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nor shall any of such payments be subject to seizure for the payment of any debt, judgment, alimony, separate maintenance or be transferable by operation of law in the event of bankruptcy, insolvency or otherwise of the Executive.

8.             INDEMNIFICATION.

(a)           INSURANCE.  The Employer shall provide the Executive (including his heirs, personal representatives, executors and administrators) for the term of this Agreement with coverage under a standard directors’ and officers’ liability insurance policy at its expense.

(b)           INDEMNIFICATION UNDER STATE LAW.  In addition to the insurance coverage provided for in paragraph (a) of this Section 8, the Employer shall hold harmless and indemnify the Executive (and his heirs, executors and administrators) to the fullest extent permitted under applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been an officer of the Employer (whether or not he continues to be an officer at the time of incurring such expenses or liabilities), such expenses and liabilities to include, but not be limited to, judgments, court costs and attorneys’ fees and the cost of reasonable settlements.

(c)           ADVANCEMENT OF EXPENSES.  In the event the Executive becomes a party, or is threatened to be made a party, to any action, suit or proceeding for which the Employer has agreed to provide insurance coverage or indemnification under this Section 8, the Employer shall, to the full extent permitted under applicable law, advance all expenses (including reasonable attorneys’ fees), judgments, fines and amounts paid in settlement (collectively “Expenses”) incurred by the Executive in connection with the investigation, defense, settlement, or appeal of any threatened, pending or completed action, suit or proceeding, subject to receipt by the Employer of a written undertaking from the Executive:  (i) to reimburse the Employer for all Expenses actually paid by the Employer to or on behalf of the Executive in the event it shall be ultimately determined that the Executive is not entitled to indemnification by the Employer for such Expenses; and (ii) to assign to the Employer all rights of the Executive to indemnification, under any policy of directors’ and officers’ liability insurance or otherwise, to the extent of the amount of Expenses actually paid by the Employer to or on behalf of the Executive.

9.             GENERAL PROVISIONS.

(a)           SUCCESSORS.  This Agreement is personal to the Executive and shall not be assignable by the Executive other than by will or the laws of descent and distribution.  This Agreement shall inure to the benefit of and be enforceable by the Executive’s designated beneficiary, or if none, the Executive’s estate.  This Agreement shall be binding upon and inure to the benefit of the Employer and its successors, and any successor of the Employer shall be deemed the “Employer” hereunder.  The Employer shall require any successor to all or substantially all of the business and/or assets of the Employer, whether directly or indirectly, by purchase, merger, consolidation, acquisition of stock, other business combination, or otherwise, by a written agreement in form and substance satisfactory to the Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same extent as the Employer would be required to perform if no such succession had taken place.

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(b)           ENTIRE AGREEMENT; MODIFICATIONS.  This Agreement, along with the Amended and Restated Life Insurance Agreement and the Participation Agreement under the Deferred Compensation Plan, constitutes the entire agreement between the parties respecting the subject matter hereof, and supersedes all prior employment agreements and all prior negotiations, undertakings, agreements and arrangements with respect hereto, whether written or oral. Except as otherwise explicitly provided herein, this Agreement may not be amended or modified except by written agreement signed by the Executive and the Employer.

(c)           ENFORCEMENT AND GOVERNING LAW.  The provisions of this Agreement shall be regarded as divisible and separate; if any of said provisions should be declared invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remaining provisions shall not be affected thereby.  This Agreement shall be construed and the legal relations of the parties hereto shall be determined in accordance with the laws of the State of Illinois without reference to the law regarding conflicts of law.

(d)           ARBITRATION.  Any dispute or controversy arising under or in connection with this Agreement or the Executive’s employment by the Employer shall be settled exclusively by arbitration, conducted by a single arbitrator sitting in a location selected by the Executive within fifty (50) miles of the main office of the Employer, in accordance with the rules of JAMS/Endispute (“JAMS”) then in effect.  The arbitrator shall be selected by the parties from a list of arbitrators provided by JAMS, provided that no arbitrator shall be related to or affiliated with either of the parties.  No later than ten (10) days after the list of proposed arbitrators is received by the parties, the parties, or their respective representatives, shall meet at a mutually convenient location or telephonically.  At that meeting, the party who sought arbitration shall eliminate one (1) proposed arbitrator and then the other party shall eliminate one (1) proposed arbitrator.  The parties shall continue to eliminate names from the list of proposed arbitrators in this manner until a single proposed arbitrator remains.  This remaining arbitrator shall arbitrate the dispute.  Each party shall submit, in writing, the specific requested action or decision it wishes to take, or make, with respect to the matter in dispute, and the arbitrator shall be obligated to choose one (1) party’s specific requested action or decision, without being permitted to effectuate any compromise position.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that the Executive shall be entitled to seek specific performance of his right to be paid through the date of termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

(e)           LEGAL FEES.  All reasonable legal fees paid or incurred by the Executive pursuant to any dispute or question of interpretation relating to this Agreement shall be paid or reimbursed by the Employer if the Executive is successful on the merits pursuant to a legal judgment, arbitration or settlement.  The Employer shall make any required payment under this paragraph (e) as soon as practicable following the time at which such expense and/or fee is incurred, but in no event later than December 31 of the year following the year in which the expense and/or fee is incurred by the Executive.

(f)            SURVIVAL.  The provisions of Sections 4 and 8 shall survive the termination of this Agreement.

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(g)           WAIVER.  No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by the other party, shall be deemed a waiver of any similar or dissimilar provisions or conditions at the same time or any prior or subsequent time.

(h)           NOTICES.  Notices pursuant to this Agreement shall be in writing and shall be deemed given when received; and, if mailed, shall be mailed by United States registered or certified mail, return receipt requested, postage prepaid; and if to the Employer, addressed to the principal headquarters of the Employer, attention:  Chairman; or, if to the Executive, to the address set forth below the Executive’s signature on this Agreement, or to such other address as the party to be notified shall have given to the other.

(i)            INTERNAL REVENUE CODE SECTION 409A.

(i)            To the extent that any of the terms and conditions contained herein constitute an amendment or modification of the time or manner of payment under a non-qualified deferred compensation plan (as defined under Code Section 409A), then to the extent necessary under the transitional guidance under Internal Revenue Service Notice 2007-86, this Agreement, as amended, constitutes an amendment to, and a new election under, such deferred compensation plan, in order to properly modify the time or manner of payment consistent with such guidance.

(ii)           It is intended that the Agreement shall comply with the provisions of Code Section 409A so as not to subject the Executive to the payment of additional taxes and interest under Code Section 409A.  In furtherance of this intent, this Agreement shall be interpreted, operated and administered in a manner consistent with these intentions, and to the extent that any regulations or other guidance issued under Code Section 409A would result in the Executive being subject to payment of additional income taxes or interest under Code Section 409A, the parties agree to amend the Agreement to maintain to the maximum extent practicable the original intent of the Agreement while avoiding the application of such taxes or interest under Code Section 409A.

(iii)          Notwithstanding any provision in the Agreement to the contrary if, as of the effective date of the Executive’s termination of employment, he is a Specified Employee (as hereinafter defined), then, only to the extent required pursuant to Code Section 409A(a)(2)(B)(i), payments due under this Agreement which are deemed to be deferred compensation shall be subject to a six (6) month delay following the Executive’s separation from service.  For purposes of Code Section 409A, all installment payments of deferred compensation made hereunder, or pursuant to another plan or arrangement, shall be deemed to be separate payments and, accordingly, the aforementioned deferral shall only apply to separate payments which would occur during the six (6) month deferral period and all other payments shall be unaffected.  All delayed payments shall be accumulated and paid in a lump-sum catch-up payment as of the first day of the seventh-month following separation from service (or, if earlier, the date of death of the Executive) with all such delayed payments being credited with interest (compounded monthly) for this period of delay equal to the prime rate in effect on the first day of such six-month period.  Any portion of the benefits hereunder that were not otherwise due to be paid during the six-month period following the termination shall be paid to the Executive in accordance with the payment schedule established herein.

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(iv)          The term “Specified Employee” shall mean any person who is a “key employee” (as defined in Code Section 416(i) without regard to paragraph (5) thereof), as determined by the Employer based upon the 12-month period ending on each December 31st (such 12-month period is referred to below as the “identification period”).  If the Executive is determined to be a key employee under Code Section 416(i) (without regard to paragraph (5) thereof) during the identification period he shall be treated as a Specified Employee for purposes of this Agreement during the 12-month period that begins on the April 1 following the close of such identification period.  For purposes of determining whether the Executive is a key employee under Code Section 416(i), “compensation” shall mean the Executive’s W-2 compensation as reported by the Employer for a particular calendar year.

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

WEST SUBURBAN BANCORP, INC.		KEITH W. ACKER
By:	/s/ Duane G. Debs	/s/ Keith W. Acker
Name:	Duane Debs
Title	President
		(Address)

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EX-10.4

Exhibit 10.4

WEST SUBURBAN BANCORP, INC.

RESTATED EMPLOYMENT AGREEMENT – DUANE G. DEBS

This RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), is made and entered into as of the 29th day of December, 2008 (the “Effective Date”), by and between WEST SUBURBAN BANCORP, INC., an Illinois corporation (the “Employer”), and DUANE G. DEBS, an Illinois resident (the “Executive”).

R E C I T A L S:

A.            The Employer owns all of the issued and outstanding capital stock of West Suburban Bank, Lombard, Illinois (the “Bank”).

B.             The Employer desires to continue to employ the Executive as an officer of the Employer and of the Bank for a specified term and the Executive is willing to continue such employment upon the terms and conditions hereinafter set forth.

C.             Additionally, the Employer recognizes that circumstances may arise which may result in a change in control of the Employer and/or the Bank (through acquisition or otherwise) thereby causing uncertainty with respect to the Executive’s employment without regard to the competence or past contributions of the Executive and that such uncertainty may result in the loss to the Employer and/or the Bank of the valuable services provided by the Executive.  In such circumstances, the Employer and the Executive wish to provide reasonable security to the Executive against changes in the Executive’s employment relationship with the Employer and/or the Bank.

D.            The Executive currently serves as the President and Chief Financial Officer of Employer and the Senior Vice President, Comptroller and Trust Officer of the Bank pursuant to that certain Employment Agreement dated March 8, 2004, as amended (the “Employment Agreement”).

E.             The parties desire to amend and restate the Employment Agreement in accordance with the terms, and subject to the conditions, set forth herein in order to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the related U.S. Treasury Department regulations and guidance promulgated thereunder (“Code Section 409A”).

NOW, THEREFORE, in consideration of the promises and of the covenants and agreements hereinafter contained, it is covenanted and agreed by and between the parties hereto as follows:

A G R E E M E N T S:

1.             TERM OF EMPLOYMENT WITH AUTOMATIC RENEWAL PROVISIONS.  The period of the Executive’s employment under this Agreement shall be deemed to have commenced on the Effective Date and shall continue for a period of approximately three (3) years through December 31, 2011.  The term of employment of the

Executive under this Agreement shall automatically be extended for one (1) additional year on December 31st of each year beginning December 31, 2009, unless either the Employer or the Executive notifies the other party, by written notice delivered no later than November 1st of such year, that the term of employment of the Executive under this Agreement shall not be extended for an additional year.  In addition, upon the occurrence of a Change in Control (as defined below), the term of employment of the Executive under this Agreement shall be automatically renewed and extended to provide a term of employment (in accordance with the terms, and subject to the conditions, set forth herein) equal to a period of three (3) years from the date of the consummation of the Change in Control.

2.             POSITION AND DUTIES.  The Employer hereby continues to employ the Executive as the President and Chief Financial Officer of the Employer and as the Senior Vice President, Comptroller and Trust Officer of the Bank or in such other senior executive capacity as shall be mutually agreed between the Employer and the Executive.  During the period of the Executive’s employment hereunder, the Executive shall devote his best efforts and full business time, energy, skills and attention to the business and affairs of the Employer and its affiliates, including the Bank.  The Executive’s duties and authority shall consist of and include all duties and authority customarily performed and held by persons holding equivalent positions with business organizations similar in nature and size to the Employer, as such duties and authority are reasonably defined, modified and delegated from time to time by the Board of Directors of the Employer (the “Board”).  The Executive shall have the powers necessary to perform the duties assigned to him and shall be provided such supporting services, staff and other assistance, office space and accoutrements as shall be reasonably necessary and appropriate in the light of such assigned duties.

3.             COMPENSATION.  As compensation for the services to be provided by the Executive hereunder, the Executive shall receive the following compensation, expense reimbursement and other benefits:

(a)           BASE SALARY.  The Executive shall receive an aggregate annual minimum base salary at the rate of two hundred fourteen thousand two hundred forty four and 91/100 dollars ($214,244.91) payable in installments in accordance with the regular payroll schedule of the Bank (“Base Salary”).  Such Base Salary shall be subject to review annually commencing in 2009 and shall be maintained or increased during the term hereof in accordance with the Employer’s established management compensation policies and practices.

(b)           BONUS.  The Executive shall be eligible for an annual bonus (“Bonus”) with respect to each fiscal year of the Employer in accordance with the Employer’s compensation and bonus policies and practices for senior executive officers.  The amount of the Bonus, if any, shall be determined by the Compensation Committee of the Board (the “Compensation Committee”).  The Bonus, if any, shall be paid no later than March 15th of the year following the calendar year in which the Bonus is earned.

(c)           DEFERRED COMPENSATION.  The Employer shall make contributions for the benefit of the Executive to the Employer’s Directors and Senior Management Deferred

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Compensation Plan (“Deferred Compensation Plan”), including any successor plan or program thereto, in an annual amount of not less than twenty-five thousand dollars ($25,000).

(d)           VACATIONS.  The Executive shall receive paid vacation days of at least such number of paid vacation days as the Executive shall be entitled to receive as of the date hereof in accordance with the Employer’s vacation policy in effect as of the date hereof.  The method of accrual, forfeiture and scheduling of vacation days shall be in accordance with, and subject to, the Employer’s general vacation policies and practices.

(e)           LONG TERM CARE INSURANCE.  The Employer shall provide the Executive and the Executive’s spouse with coverage under, and shall pay the premiums with respect to, long term care insurance in accordance with the terms, and subject to the conditions, as the Employer shall provide to other senior executive officers.  The Executive acknowledges that this benefit shall be subject to the continued availability of such long term care insurance from the insurer under which this benefit is provided to other senior executives from time to time.

(f)            REIMBURSEMENT OF EXPENSES.  The Executive shall be reimbursed, upon submission of appropriate vouchers and supporting documentation, for all travel, entertainment and other out-of-pocket expenses reasonably and necessarily incurred by the Executive in the performance of his duties hereunder and shall be entitled to attend seminars, conferences and meetings relating to the business of the Employer consistent with the Employer’s established policies in that regard; provided, that such reimbursement will be made as soon as practicable and, when taxable to the Executive, shall be made no later than the end of the calendar year following the year in which the expenses or other charges were incurred.

(g)           OTHER BENEFITS.  The Executive shall be entitled to all benefits specifically established for him and, when and to the extent he is eligible therefor, to participate in all plans and benefits generally accorded to senior executives of the Employer, including, but not limited to the following to the extent provided, if at all, to other senior executives of the Employer:  pension; profit-sharing; employee stock ownership plan; supplemental retirement; incentive compensation; bonus; disability income; split-dollar life insurance; group life; health, medical (including dental, vision and prescription drug insurance, if any) and hospitalization insurance; long term care insurance; and similar or comparable plans, and also to perquisites extended to similarly situated senior executives; provided, however, that such plans, benefits and perquisites shall be no less than those made available to all other employees of the Employer.

(h)           WITHHOLDING.  The Employer shall be entitled to withhold from amounts payable to the Executive hereunder, any federal, state or local withholding or other taxes or charges which it is from time to time required to withhold.  The Employer shall be entitled to rely upon the opinion of its legal counsel with regard to any question concerning the amount or requirement of any such withholding.

4.             CONFIDENTIALITY AND LOYALTY.  The Executive acknowledges that heretofore or hereafter during the course of his employment he has produced and may hereafter produce and have access to material, records, data, trade secrets and information not generally available to the public (collectively, “Confidential Information”) regarding the Employer and its subsidiaries and affiliates.  Accordingly, during and subsequent to termination of this

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Agreement, the Executive shall hold in confidence and not directly or indirectly disclose, use, copy or make lists of any such Confidential Information, except to the extent that such information is or thereafter becomes lawfully available from public sources, or such disclosure is authorized in writing by the Employer, required by a law or any competent administrative agency or judicial authority, or otherwise as reasonably necessary or appropriate in connection with performance by the Executive of his duties hereunder.  All records, files, documents and other materials or copies thereof relating to the Employer’s business which the Executive shall prepare or use, shall be and remain the sole property of the Employer, shall not be removed from the Employer’s premises without its written consent, and shall be promptly returned to the Employer upon termination of the Executive’s employment hereunder.  The Executive agrees to abide by the Employer’s reasonable policies, as in effect from time to time, respecting avoidance of interests conflicting with those of the Employer.  In the event of any violation or threatened violation of these restrictions, the Employer, in addition to and not in limitation of being relieved of all further obligations under this Agreement and of any other rights, remedies or damages available to the Employer under this Agreement or otherwise at law or in equity, shall be entitled to preliminary and permanent injunctive relief to prevent or restrain any such violation by the Executive and any and all persons directly or indirectly acting for or with him, as the case may be.

5.             TERMINATION.  The Executive’s employment during the term of this Agreement may be terminated by the Employer or the Executive without any breach of this Agreement only under the circumstances described in this Section 5 (where such termination constitutes a “separation from service” pursuant to Code Section 409A):

(a)AGREEMENT NON-EXTENSION OR EMPLOYMENT TERMINATION BY THE EMPLOYER AND TERMINATION BY THE EXECUTIVE.

(i)            In the event of the termination of the Executive’s employment under this Agreement by the Employer prior to the last day of the then current term for any reason other than a termination in accordance with the provisions of paragraph (c) of this Section 5 (TERMINATION FOR CAUSE), the Employer shall pay the Executive a lump sum payment equal to the sum of the amount of his Base Salary payable for the remainder of the current term, plus the amount of the Executive’s annual Bonus(es) payable for the remainder of the current term based on an amount equal to the average of his most recent three (3) years’ annual Bonus amounts.  Such payment shall be paid to the Executive within thirty (30) days of the Executive’s termination of employment.  In addition, the Employer shall continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to his termination of employment under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement, provided, however, that the payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of termination.  In the event of a non-extension of this Agreement by the Employer in accordance with the provisions of Section 1, the Employer shall:  (A) continue to pay the Executive the Base Salary then payable to the Executive pursuant to the Employer’s standard payroll practice; (B) continue to pay the

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Executive an annual Bonus in an amount equal to the average of his most recent three (3) years’ annual Bonus amounts pursuant to the Employer’s standard Bonus payment practices; and (C) continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to the non-extension under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement; provided, however, that in the circumstance where the term of this Agreement is not extended, the Executive must remain employed with the Employer to receive such payments and benefits; further provided, that the continued payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of the notice of non-extension.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(ii)           In the event that the term of this Agreement is not extended in accordance with the provisions of Section 1, the Executive may elect to terminate his employment and upon such termination, the Employer shall pay the Executive a lump sum amount equal to nine (9) times the sum of: (A) the monthly Base Salary then payable to the Executive; plus (B) one twelfth (1/12) of the base annual deferred compensation contribution made by the Employer under the Deferred Compensation Plan for the year prior to the Executive’s termination.  The election by the Executive to terminate his employment pursuant to this subparagraph (a)(ii) must be delivered in writing to the Employer within forty-five (45) days of the later of his receipt of notice of the non-extension of the term of this Agreement or December 31st of the year during which such notice is delivered.  Payment to the Executive will be made within thirty (30) days of such termination.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and

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between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(iii)          Unless a Change in Control shall have occurred, if the Employer is not in compliance with its minimum capital requirements or if the payments required under subparagraph (i) or (ii) above would cause the Employer’s capital to be reduced below its minimum capital requirements, such payments shall be deferred, as permitted pursuant to Code Section 409A, until such time as the Employer is in capital compliance.

(b)           CONSTRUCTIVE DISCHARGE.  If at any time during the term of this Agreement, except in connection with a termination pursuant to paragraph (c) (TERMINATION FOR CAUSE) of this Section 5, the Executive is Constructively Discharged (as hereinafter defined) then the Executive shall have the right, by written notice to the Employer within sixty (60) days of the initial existence of such Constructive Discharge condition, to terminate his services hereunder, effective as of the thirtieth (30th) day after such notice, and the Executive shall have no rights or obligations under this Agreement other than as provided in Sections 4 and 8 hereof; provided, however, the Employer shall have thirty (30) days from the date of such notice in which to cure the condition giving rise to a Constructive Discharge, if curable.  If, during such thirty (30) day period, the Employer cures the condition giving rise to Constructive Discharge, then the Executive’s notice of termination hereunder shall not be effective, the Executive’s employment shall continue until otherwise terminated under this Agreement, and no benefits shall be due under this Agreement with respect to such occurrence.  If the Employer fails to cure the condition giving rise to Constructive Discharge within such thirty (30) day period, the Executive shall be entitled to a lump sum payment of compensation and benefits and continuation of all plans and benefits as if such termination of his employment was pursuant to subparagraph (a)(i) of this Section 5 to be paid within thirty (30) days of the Executive’s termination of employment.

(i)            For purposes of this Agreement, the Executive shall be “Constructively Discharged” upon the occurrence of any one of the following events:

(A)          The Executive is not re-elected or is removed from the positions with the Employer or any affiliate set forth in Section 1 hereof, other than as a result of the Executive’s election or appointment to positions of equal or superior scope and responsibility; or

(B)           The Executive shall fail to be vested by the Employer with the powers and authority of his appointed office; or

(C)           The Employer changes the primary employment location of the Executive to a place that is more than thirty (30) miles from the primary employment location as of the Effective Date of this Agreement; or

(D)          The Employer otherwise commits a material breach of its obligations under this Agreement.

(c)            TERMINATION FOR CAUSE.  The Executive’s employment hereunder may be terminated for Cause (as hereinafter defined).  “Cause” shall mean:  (i) the Executive’s death; (ii) a material violation by the Executive of any applicable material law or regulation respecting

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the business of the Employer; (iii) the Executive being found guilty of a felony or an act of dishonesty in connection with the performance of his duties as an officer of the Employer, or which disqualifies the Executive from serving as an officer or director of the Employer; or (iv) the willful or negligent failure of the Executive to perform his duties hereunder in any material respect.  The Executive’s employment under this Agreement may be terminated immediately for any Cause except under (iv) above.  The Executive shall be entitled to at least thirty (30) days’ prior written notice of the Employer’s intention to terminate his employment under (iv) above, specifying the grounds for such termination, a reasonable opportunity to cure any conduct or act, if curable, alleged as grounds for such termination, and a reasonable opportunity to present to the Board his position regarding any dispute relating to the existence of such Cause.  Upon the Executive’s termination for Cause, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of:  (A) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (B) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (C) all accrued and unused sick days; and (D) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(d)           TERMINATION UPON DEATH.  Upon the Executive’s death, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of:  (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the date of death; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) all accrued and unused sick days; and (iv) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments as are provided under the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his death.  Payment shall be made to such beneficiary as the Executive may designate in writing, or failing such designation, to the executor of his estate, in full settlement and satisfaction of all claims and demands on behalf of the Executive.  Such payments shall be in full settlement and satisfaction of all payments provided for in this Agreement.

(e)           TERMINATION UPON CHANGE IN CONTROL.

(i)            In the event of a Change in Control and the termination of the Executive’s employment under either (A) or (B) below, the Executive shall be entitled to a lump sum payment equal to three (3) times the sum of the following:  (w) his annual Base Salary then payable; plus (x) the average of his most recent three (3) years’ annual Deferred Compensation

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Plan contributions; plus (y) the average of his most recent three (3) years’ Employer contributions to all Employer-sponsored tax-qualified retirement plans; plus (z) the average of his most recent three (3) years’ annual Bonuses.  The payment of such lump sum shall be paid to the Executive within thirty (30) days of his termination of employment.  In the event of a Change in Control, the Employer shall also provide the Executive with the benefits contemplated in subparagraph (ii) of paragraph (g) (CERTAIN INSURANCE BENEFITS) of this Section 5 below and, upon termination of the Executive’s employment under either (A) or (B) below, shall pay the Executive, within thirty (30) days of termination:  (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies on reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.  If the Executive’s employment has terminated prior to the Change in Control in accordance with the terms of this Agreement and the Employer has made all required payments under any other applicable provision of this Section 5, then no amount shall be paid under this paragraph (e).  Either of the following shall constitute termination under this paragraph:

(A)          The Executive terminates his employment by a written notice to that effect delivered to the Employer within twenty-four (24) months after the Change in Control.

(B)           The Executive’s employment under this Agreement is terminated by the Employer either in contemplation of or after the Change in Control.

(ii)           Notwithstanding the preceding paragraphs of this Section 5 and except as provided in this subparagraph (ii), in the event that it shall be determined that any payment, benefit or other entitlement under this Agreement and any other plan or arrangement of the Employer or the Bank (the “Total Payments”) would constitute an “Excess Parachute Payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and thereby be subject to the excise tax imposed by Section 4999 of the Code or any similar successor provision or any interest or penalties with respect to such excise tax (collectively the “Excise Tax”), then, except in the case of a de Minimus Excess Amount (as defined below), the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes imposed upon the Gross-Up Payment (including any federal, state and local income, payroll and excise taxes and any interest or penalties imposed with respect to such taxes), the Executive retains an amount of the Gross Up Payment equal to the Excise Tax imposed upon the Total Payments (not including any Gross-Up Payment).  Such Gross-Up Payment shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the Excise Tax.  If, at a later date, the Internal Revenue Service assesses a deficiency against the Executive for the Excise Tax which is greater than that which was determined at the time such

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amounts were paid, then the Employer shall pay to the Executive the amount of such unreimbursed Excise Tax plus any interest, penalties and reasonable professional fees or expenses incurred by the Executive as a result of such assessment, including all such taxes with respect to any such additional amount, which amounts shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the deficient Excise Tax.  The highest marginal tax rate applicable to individuals at the time of the payment of such amounts will be used for purposes of determining the federal and state income and other taxes with respect thereto.  The Employer shall withhold from any amounts paid under this Agreement the amount of any Excise Tax or other federal, state or local taxes then required to be withheld.  Computations of the amount of the Gross-Up Payment paid under this subparagraph shall be conclusively made by the Employer’s independent accountants, in consultation, if necessary, with the Employer’s independent legal counsel.  If, after the Executive receives any Gross-Up Payment or other amount pursuant to this subparagraph, the Executive receives any refund with respect to the Excise Tax, the Executive shall promptly pay the Employer the amount of such refund within ten (10) days of receipt by the Executive.  Notwithstanding the foregoing, in the event that the amount by which the present value of the Total Payments which would constitute an Excess Parachute Payment is less than two percent (2%) of the Total Payments, then such Excess Parachute Payment shall be deemed to be a “de Minimus Excess Amount” and the Executive shall not be entitled to a Gross-Up Payment.  In such a case, the Total Payments will be reduced to an amount (the “Non-Triggering Amount”), the value of which is one dollar ($1.00) less than an amount equal to three (3) times the Executive’s “base amount,” as determined in accordance with Code Section 280G; provided, however, that such reduction shall not be made unless the Non-Triggering Amount would be greater than the aggregate value of the Total Payments (without such reduction) minus the amount of Excise Tax required to be paid by the Executive thereon.  The allocation of the reduction required by the preceding sentence shall be determined by the Executive and the Executive shall notify the Employer in writing of the allocation; provided, however, that if the Executive fails to notify the Employer, then the Employer shall make the allocation; and provided further, however, that any such allocation shall not be effective where it would result in an imposition of additional income tax under Code Section 409A.

(iii)          For purposes of this Agreement, the term “Change in Control” shall mean any of the following:

(A)          The consummation of the acquisition by any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Employer or the Bank; or

(B)           The individuals who, as of the date hereof, are members of the Board of the Employer or the Bank cease for any reason to constitute a majority of the Board, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of a majority of the Board, and such new director shall, for purposes of this Agreement, be considered as a member of the Board; or

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(C)           Consummation by the Employer or the Bank of:  (1) a merger or consolidation if the shareholders immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of the Employer or the Bank outstanding immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of the Employer or the Bank.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Employer or the Bank is acquired by:  (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the Employer or the Bank; or (2) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders in the same proportion as their ownership of stock of the Employer or the Bank immediately prior to such acquisition.

(f)            REGULATORY SUSPENSION AND TERMINATION.

(i)            If the Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Employer’s affairs by a notice served under Section 8(e)(3) (12 U.S.C. Section 1818(e)(3)) or 8(g) (12 U.S.C. Section 1818(g)) of the Federal Deposit Insurance Act, as amended, the Employer’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 Employer shall: (A) pay the Executive all of the compensation withheld while the contract obligations were suspended; and (B) reinstate any of the obligations which were suspended.

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

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

(iv)          All obligations of the Employer under this contract shall be terminated, except to the extent determined that continuation of the contract is necessary for the continued operation of the institution by the Federal Deposit Insurance Corporation (the “FDIC”), at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Employer under the authority contained in Section 13(c) (12 U.S.C. Section 1823(c)) of the Federal Deposit Insurance Act, as amended, or when the Employer is determined by the FDIC to be in an

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unsafe or unsound condition.  Any rights of the parties that have already vested, however, shall not be affected by such action.

(v)           Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with Section 18(k) (12 U.S.C. Section 1828(k)) of the Federal Deposit Insurance Act as amended, and any regulations promulgated thereunder.

(g)           CERTAIN INSURANCE BENEFITS.

(i)            In the event of the termination of the Executive’s employment under this Agreement due to “retirement” (as hereinafter defined), the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death: (A) continuing coverage for the Executive and the Executive’s Spouse under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination); and (B) long term care insurance in accordance with paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.  The term “retirement” for purposes of this paragraph (g) shall mean the Executive: (a) terminates employment at or after the attainment of age 62; and (b) does not engage in any form of gainful employment on or after his termination of employment.  The continued coverage under this subparagraph (g)(i) shall be for benefits at a level equivalent to the Executive’s benefits at the time of the Executive’s termination of employment.  The continued coverage under this subparagraph (g)(i) shall terminate upon the Executive’s engaging in any gainful employment on or after his termination of employment.

(ii)           After the occurrence of a Change in Control, the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death:  (A) continuing coverage that is equivalent to the coverage provided under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination) maintained by the Employer at the time of the Change in Control; and (B) long term care insurance in accordance with paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.

(iii)          In the event of the termination of the Executive’s employment under this Agreement other than as contemplated above in this paragraph (g) or pursuant to paragraph (c) (TERMINATION FOR CAUSE) of Section 5 above, at the election of the Executive (including the estate of the Executive) and the Executive’s Spouse and provided such action is not prohibited by the policy pursuant to which the Executive receives the benefit contemplated in paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above, the Employer shall take all actions necessary, including, but not limited to, a transfer and assignment of its interests in the long term health insurance provided to the Executive pursuant to paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above, in order to facilitate the ability of the Executive and the Executive’s Spouse to continue to maintain the long term health insurance at no additional cost to the Employer.

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(iv)          The payment of premiums for insurance benefits listed in this paragraph (g) shall be remitted to the appropriate carrier no later than thirty (30) days following receipt of the applicable premium invoice.

6.             PAYMENT UPON DISABILITY.  If during the term of this Agreement, the Executive is deemed to have a Disability (as hereinafter defined), the Employer shall provide the Executive with the payments and benefits set forth in this Section 6.  “Disability,” for purposes of this Agreement shall mean that: (i) the Executive is unable to engage in any substantial gainful activity by reason of 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, or (ii) the Executive is, by reason of 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, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Employer.  The Executive shall be entitled to the compensation and benefits provided for under this Agreement for any period during the term of this Agreement and prior to the establishment of the Executive’s Disability during which the Executive is unable to work due to a physical or mental infirmity.  If the Executive is determined to have a Disability, the Employer shall continue to pay the Executive eighty percent (80%) of the Base Salary per month then payable to the Executive, reduced by any amounts received under the Employer sponsored disability income insurance program, and shall continue to provide coverage for the Executive under the health and life insurance programs maintained by the Employer by the payment of applicable premiums in accordance with the Employer’s standard payment practice until the earlier of the date the Executive returns to full-time employment, either with the Employer or another employer, or the Executive’s normal retirement age under the Social Security Act, as amended.  In addition, if the Executive’s employment is terminated following his Disability, the Employer shall pay the Executive, within thirty (30) days of termination: (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) for all accrued and unused sick days; and (iv) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his termination.  Notwithstanding any other provision of this Agreement, in the event of the termination of the Executive’s employment under this Agreement for any reason, if permitted by law, the Executive may elect to have any disability income insurance policy maintained by the Employer on his behalf transferred to him, and he shall assume all obligations thereunder.

7.             INTEREST IN ASSETS.  Neither the Executive nor his estate shall acquire hereunder any rights in funds or assets of the Employer, otherwise than by and through the actual payment of amounts payable hereunder; nor shall the Executive or his estate have any power to transfer, assign, anticipate, hypothecate or otherwise encumber in advance any of said payments;

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nor shall any of such payments be subject to seizure for the payment of any debt, judgment, alimony, separate maintenance or be transferable by operation of law in the event of bankruptcy, insolvency or otherwise of the Executive.

8.             INDEMNIFICATION.

(a)           INSURANCE.  The Employer shall provide the Executive (including his heirs, personal representatives, executors and administrators) for the term of this Agreement with coverage under a standard directors’ and officers’ liability insurance policy at its expense.

(b)           INDEMNIFICATION UNDER STATE LAW.  In addition to the insurance coverage provided for in paragraph (a) of this Section 8, the Employer shall hold harmless and indemnify the Executive (and his heirs, executors and administrators) to the fullest extent permitted under applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been an officer of the Employer (whether or not he continues to be an officer at the time of incurring such expenses or liabilities), such expenses and liabilities to include, but not be limited to, judgments, court costs and attorneys’ fees and the cost of reasonable settlements.

(c)           ADVANCEMENT OF EXPENSES.  In the event the Executive becomes a party, or is threatened to be made a party, to any action, suit or proceeding for which the Employer has agreed to provide insurance coverage or indemnification under this Section 8, the Employer shall, to the full extent permitted under applicable law, advance all expenses (including reasonable attorneys’ fees), judgments, fines and amounts paid in settlement (collectively “Expenses”) incurred by the Executive in connection with the investigation, defense, settlement, or appeal of any threatened, pending or completed action, suit or proceeding, subject to receipt by the Employer of a written undertaking from the Executive:  (i) to reimburse the Employer for all Expenses actually paid by the Employer to or on behalf of the Executive in the event it shall be ultimately determined that the Executive is not entitled to indemnification by the Employer for such Expenses; and (ii) to assign to the Employer all rights of the Executive to indemnification, under any policy of directors’ and officers’ liability insurance or otherwise, to the extent of the amount of Expenses actually paid by the Employer to or on behalf of the Executive.

9.             GENERAL PROVISIONS.

(a)           SUCCESSORS.  This Agreement is personal to the Executive and shall not be assignable by the Executive other than by will or the laws of descent and distribution.  This Agreement shall inure to the benefit of and be enforceable by the Executive’s designated beneficiary, or if none, the Executive’s estate.  This Agreement shall be binding upon and inure to the benefit of the Employer and its successors, and any successor of the Employer shall be deemed the “Employer” hereunder.  The Employer shall require any successor to all or substantially all of the business and/or assets of the Employer, whether directly or indirectly, by purchase, merger, consolidation, acquisition of stock, other business combination, or otherwise, by a written agreement in form and substance satisfactory to the Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same extent as the Employer would be required to perform if no such succession had taken place.

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(b)           ENTIRE AGREEMENT; MODIFICATIONS.  This Agreement, along with the Amended and Restated Life Insurance Agreement and the Participation Agreement under the Deferred Compensation Plan, constitutes the entire agreement between the parties respecting the subject matter hereof, and supersedes all prior employment agreements and all prior negotiations, undertakings, agreements and arrangements with respect hereto, whether written or oral.  Except as otherwise explicitly provided herein, this Agreement may not be amended or modified except by written agreement signed by the Executive and the Employer.

(c)           ENFORCEMENT AND GOVERNING LAW.  The provisions of this Agreement shall be regarded as divisible and separate; if any of said provisions should be declared invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remaining provisions shall not be affected thereby.  This Agreement shall be construed and the legal relations of the parties hereto shall be determined in accordance with the laws of the State of Illinois without reference to the law regarding conflicts of law.

(d)           ARBITRATION.  Any dispute or controversy arising under or in connection with this Agreement or the Executive’s employment by the Employer shall be settled exclusively by arbitration, conducted by a single arbitrator sitting in a location selected by the Executive within fifty (50) miles of the main office of the Employer, in accordance with the rules of JAMS/Endispute (“JAMS”) then in effect.  The arbitrator shall be selected by the parties from a list of arbitrators provided by JAMS, provided that no arbitrator shall be related to or affiliated with either of the parties.  No later than ten (10) days after the list of proposed arbitrators is received by the parties, the parties, or their respective representatives, shall meet at a mutually convenient location or telephonically.  At that meeting, the party who sought arbitration shall eliminate one (1) proposed arbitrator and then the other party shall eliminate one (1) proposed arbitrator.  The parties shall continue to eliminate names from the list of proposed arbitrators in this manner until a single proposed arbitrator remains.  This remaining arbitrator shall arbitrate the dispute.  Each party shall submit, in writing, the specific requested action or decision it wishes to take, or make, with respect to the matter in dispute, and the arbitrator shall be obligated to choose one (1) party’s specific requested action or decision, without being permitted to effectuate any compromise position.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that the Executive shall be entitled to seek specific performance of his right to be paid through the date of termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

(e)           LEGAL FEES.  All reasonable legal fees paid or incurred by the Executive pursuant to any dispute or question of interpretation relating to this Agreement shall be paid or reimbursed by the Employer if the Executive is successful on the merits pursuant to a legal judgment, arbitration or settlement.  The Employer shall make any required payment under this paragraph (e) as soon as practicable following the time at which such expense and/or fee is incurred, but in no event later than December 31 of the year following the year in which the expense and/or fee is incurred by the Executive.

(f)            SURVIVAL.  The provisions of Sections 4 and 8 shall survive the termination of this Agreement.

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(g)           WAIVER.  No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by the other party, shall be deemed a waiver of any similar or dissimilar provisions or conditions at the same time or any prior or subsequent time.

(h)           NOTICES.  Notices pursuant to this Agreement shall be in writing and shall be deemed given when received; and, if mailed, shall be mailed by United States registered or certified mail, return receipt requested, postage prepaid; and if to the Employer, addressed to the principal headquarters of the Employer, attention:  Chairman; or, if to the Executive, to the address set forth below the Executive’s signature on this Agreement, or to such other address as the party to be notified shall have given to the other.

(i)            INTERNAL REVENUE CODE SECTION 409A.

(i)            To the extent that any of the terms and conditions contained herein constitute an amendment or modification of the time or manner of payment under a non-qualified deferred compensation plan (as defined under Code Section 409A), then to the extent necessary under the transitional guidance under Internal Revenue Service Notice 2007-86, this Agreement, as amended, constitutes an amendment to, and a new election under, such deferred compensation plan, in order to properly modify the time or manner of payment consistent with such guidance.

(ii)           It is intended that the Agreement shall comply with the provisions of Code Section 409A so as not to subject the Executive to the payment of additional taxes and interest under Code Section 409A.  In furtherance of this intent, this Agreement shall be interpreted, operated and administered in a manner consistent with these intentions, and to the extent that any regulations or other guidance issued under Code Section 409A would result in the Executive being subject to payment of additional income taxes or interest under Code Section 409A, the parties agree to amend the Agreement to maintain to the maximum extent practicable the original intent of the Agreement while avoiding the application of such taxes or interest under Code Section 409A.

(iii)          Notwithstanding any provision in the Agreement to the contrary if, as of the effective date of the Executive’s termination of employment, he is a Specified Employee (as hereinafter defined), then, only to the extent required pursuant to Code Section 409A(a)(2)(B)(i), payments due under this Agreement which are deemed to be deferred compensation shall be subject to a six (6) month delay following the Executive’s separation from service.  For purposes of Code Section 409A, all installment payments of deferred compensation made hereunder, or pursuant to another plan or arrangement, shall be deemed to be separate payments and, accordingly, the aforementioned deferral shall only apply to separate payments which would occur during the six (6) month deferral period and all other payments shall be unaffected.  All delayed payments shall be accumulated and paid in a lump-sum catch-up payment as of the first day of the seventh-month following separation from service (or, if earlier, the date of death of the Executive) with all such delayed payments being credited with interest (compounded monthly) for this period of delay equal to the prime rate in effect on the first day of such six-month period.  Any portion of the benefits hereunder that were not otherwise due to be paid during the six-month period following the termination shall be paid to the Executive in accordance with the payment schedule established herein.

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(iv)          The term “Specified Employee” shall mean any person who is a “key employee” (as defined in Code Section 416(i) without regard to paragraph (5) thereof), as determined by the Employer based upon the 12-month period ending on each December 31st (such 12-month period is referred to below as the “identification period”).  If the Executive is determined to be a key employee under Code Section 416(i) (without regard to paragraph (5) thereof) during the identification period he shall be treated as a Specified Employee for purposes of this Agreement during the 12-month period that begins on the April 1 following the close of such identification period.  For purposes of determining whether the Executive is a key employee under Code Section 416(i), “compensation” shall mean the Executive’s W-2 compensation as reported by the Employer for a particular calendar year.

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

WEST SUBURBAN BANCORP, INC.		DUANE G. DEBS
By:	/s/ Kevin J. Acker	/s/ Duane G. Debs
Name:	Kevin J. Acker
Title:	Chief Executive Officer
		(Address)

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EX-10.5

Exhibit 10.5

WEST SUBURBAN BANCORP, INC.

RESTATED EMPLOYMENT AGREEMENT – MICHAEL P. BROSNAHAN

This RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), is made and entered into as of the 29th day of December, 2008 (the “Effective Date”), by and between WEST SUBURBAN BANCORP, INC., an Illinois corporation (the “Employer”), and MICHAEL P. BROSNAHAN, an Illinois resident (the “Executive”).

R E C I T A L S:

A.The Employer owns all of the issued and outstanding capital stock of West Suburban Bank, Lombard, Illinois (the “Bank”).

B.The Employer desires to continue to employ the Executive as an officer of the Employer and of the Bank for a specified term and the Executive is willing to continue such employment upon the terms and conditions hereinafter set forth.

C.Additionally, the Employer recognizes that circumstances may arise which may result in a change in control of the Employer and/or the Bank (through acquisition or otherwise) thereby causing uncertainty with respect to the Executive’s employment without regard to the competence or past contributions of the Executive and that such uncertainty may result in the loss to the Employer and/or the Bank of the valuable services provided by the Executive.  In such circumstances, the Employer and the Executive wish to provide reasonable security to the Executive against changes in the Executive’s employment relationship with the Employer and/or the Bank.

D.The Executive currently serves as the Vice President of Employer and the Senior Vice President, Commercial Lending and Community Reinvestment Act Officer of the Bank pursuant to that certain Employment Agreement dated March 8, 2004, as amended (the “Employment Agreement”).

E.The parties desire to amend and restate the Employment Agreement in accordance with the terms, and subject to the conditions, set forth herein in order to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the related U.S. Treasury Department regulations and guidance promulgated thereunder (“Code Section 409A”).

NOW, THEREFORE, in consideration of the promises and of the covenants and agreements hereinafter contained, it is covenanted and agreed by and between the parties hereto as follows:

A G R E E M E N T S:

1.TERM OF EMPLOYMENT WITH AUTOMATIC RENEWAL PROVISIONS.  The period of the Executive’s employment under this Agreement shall be deemed to have commenced on the Effective Date and shall continue for a period of approximately three (3) years through December 31, 2011.  The term of employment of the

Executive under this Agreement shall automatically be extended for one (1) additional year on December 31st of each year beginning December 31, 2009, unless either the Employer or the Executive notifies the other party, by written notice delivered no later than November 1st of such year, that the term of employment of the Executive under this Agreement shall not be extended for an additional year.  In addition, upon the occurrence of a Change in Control (as defined below), the term of employment of the Executive under this Agreement shall be automatically renewed and extended to provide a term of employment (in accordance with the terms, and subject to the conditions, set forth herein) equal to a period of three (3) years from the date of the consummation of the Change in Control.

2.POSITION AND DUTIES.  The Employer hereby continues to employ the Executive as the Vice President of the Employer and as the Senior Vice President, Commercial Lending and Community Reinvestment Act Officer of the Bank or in such other senior executive capacity as shall be mutually agreed between the Employer and the Executive.  During the period of the Executive’s employment hereunder, the Executive shall devote his best efforts and full business time, energy, skills and attention to the business and affairs of the Employer and its affiliates, including the Bank.  The Executive’s duties and authority shall consist of and include all duties and authority customarily performed and held by persons holding equivalent positions with business organizations similar in nature and size to the Employer, as such duties and authority are reasonably defined, modified and delegated from time to time by the Board of Directors of the Employer (the “Board”).  The Executive shall have the powers necessary to perform the duties assigned to him and shall be provided such supporting services, staff and other assistance, office space and accoutrements as shall be reasonably necessary and appropriate in the light of such assigned duties.

3.COMPENSATION.  As compensation for the services to be provided by the Executive hereunder, the Executive shall receive the following compensation, expense reimbursement and other benefits:

(a)BASE SALARY.  The Executive shall receive an aggregate annual minimum base salary at the rate of two hundred twenty eight thousand three hundred fifty five and 30/100 dollars ($228,355.30) payable in installments in accordance with the regular payroll schedule of the Bank (“Base Salary”).  Such Base Salary shall be subject to review annually commencing in 2009 and shall be maintained or increased during the term hereof in accordance with the Employer’s established management compensation policies and practices.

(b)BONUS.  The Executive shall be eligible for an annual bonus (“Bonus”) with respect to each fiscal year of the Employer in accordance with the Employer’s compensation and bonus policies and practices for senior executive officers.  The amount of the Bonus, if any, shall be determined by the Compensation Committee of the Board (the “Compensation Committee”).  The Bonus, if any, shall be paid no later than March 15th of the year following the calendar year in which the Bonus is earned.

(c)CLUB MEMBERSHIP.  The Executive shall be reimbursed for the membership dues and other customary charges at the Naperville Country Club incurred by the Executive.  Any

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such reimbursement shall be made no later than the end of the calendar year following the year in which the dues or other charges were incurred.

(d)DEFERRED COMPENSATION.  The Employer shall make contributions for the benefit of the Executive to the Employer’s Directors and Senior Management Deferred Compensation Plan (“Deferred Compensation Plan”), including any successor plan or program thereto, in an annual amount of not less than twenty-five thousand dollars ($25,000).

(e)VACATIONS.  The Executive shall receive paid vacation days of at least such number of paid vacation days as the Executive shall be entitled to receive as of the date hereof in accordance with the Employer’s vacation policy in effect as of the date hereof.  The method of accrual, forfeiture and scheduling of vacation days shall be in accordance with, and subject to, the Employer’s general vacation policies and practices.

(f)LONG TERM CARE INSURANCE.  The Employer shall provide the Executive and the Executive’s spouse with coverage under, and shall pay the premiums with respect to, long term care insurance in accordance with the terms, and subject to the conditions, as the Employer shall provide to other senior executive officers.  The Executive acknowledges that this benefit shall be subject to the continued availability of such long term care insurance from the insurer under which this benefit is provided to other senior executives from time to time.

(g)REIMBURSEMENT OF EXPENSES.  The Executive shall be reimbursed, upon submission of appropriate vouchers and supporting documentation, for all travel, entertainment and other out-of-pocket expenses reasonably and necessarily incurred by the Executive in the performance of his duties hereunder and shall be entitled to attend seminars, conferences and meetings relating to the business of the Employer consistent with the Employer’s established policies in that regard; provided that such reimbursement will be made as soon as practicable and, when taxable to the Executive, shall be made no later than the end of the calendar year following the year in which the expenses or other charges were incurred.

(h)OTHER BENEFITS.  The Executive shall be entitled to all benefits specifically established for him and, when and to the extent he is eligible therefor, to participate in all plans and benefits generally accorded to senior executives of the Employer, including, but not limited to the following to the extent provided, if at all, to other senior executives of the Employer:  pension; profit-sharing; employee stock ownership plan; supplemental retirement; incentive compensation; bonus; disability income; split-dollar life insurance; group life; health, medical (including dental, vision and prescription drug insurance, if any) and hospitalization insurance; long term care insurance; and similar or comparable plans, and also to perquisites extended to similarly situated senior executives; provided, however, that such plans, benefits and perquisites shall be no less than those made available to all other employees of the Employer.

(i)WITHHOLDING.  The Employer shall be entitled to withhold from amounts payable to the Executive hereunder, any federal, state or local withholding or other taxes or charges which it is from time to time required to withhold.  The Employer shall be entitled to rely upon the opinion of its legal counsel with regard to any question concerning the amount or requirement of any such withholding.

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4.CONFIDENTIALITY AND LOYALTY.  The Executive acknowledges that heretofore or hereafter during the course of his employment he has produced and may hereafter produce and have access to material, records, data, trade secrets and information not generally available to the public (collectively, “Confidential Information”) regarding the Employer and its subsidiaries and affiliates.  Accordingly, during and subsequent to termination of this Agreement, the Executive shall hold in confidence and not directly or indirectly disclose, use, copy or make lists of any such Confidential Information, except to the extent that such information is or thereafter becomes lawfully available from public sources, or such disclosure is authorized in writing by the Employer, required by a law or any competent administrative agency or judicial authority, or otherwise as reasonably necessary or appropriate in connection with performance by the Executive of his duties hereunder.  All records, files, documents and other materials or copies thereof relating to the Employer’s business which the Executive shall prepare or use, shall be and remain the sole property of the Employer, shall not be removed from the Employer’s premises without its written consent, and shall be promptly returned to the Employer upon termination of the Executive’s employment hereunder.  The Executive agrees to abide by the Employer’s reasonable policies, as in effect from time to time, respecting avoidance of interests conflicting with those of the Employer.  In the event of any violation or threatened violation of these restrictions, the Employer, in addition to and not in limitation of being relieved of all further obligations under this Agreement and of any other rights, remedies or damages available to the Employer under this Agreement or otherwise at law or in equity, shall be entitled to preliminary and permanent injunctive relief to prevent or restrain any such violation by the Executive and any and all persons directly or indirectly acting for or with him, as the case may be.

5.TERMINATION.  The Executive’s employment during the term of this Agreement may be terminated by the Employer or the Executive without any breach of this Agreement only under the circumstances described in this Section 5 (where such termination constitutes a “separation from service” pursuant to Code Section 409A):

(a)AGREEMENT NON-EXTENSION OR EMPLOYMENT TERMINATION BY THE EMPLOYER AND TERMINATION BY THE EXECUTIVE.

(i)In the event of the termination of the Executive’s employment under this Agreement by the Employer prior to the last day of the then current term for any reason other than a termination in accordance with the provisions of paragraph (c) of this Section 5 (TERMINATION FOR CAUSE), the Employer shall pay the Executive a lump sum payment equal to the sum of the amount of his Base Salary payable for the remainder of the current term, plus the amount of the Executive’s annual Bonus(es) payable for the remainder of the current term based on an amount equal to the average of his most recent three (3) years’ annual Bonus amounts.  Such payment shall be paid to the Executive within thirty (30) days of the Executive’s termination of employment.  In addition, the Employer shall continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to his termination of employment under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term

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of this Agreement, provided, however, that the payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of termination.  In the event of a non-extension of this Agreement by the Employer in accordance with the provisions of Section 1, the Employer shall: (A) continue to pay the Executive the Base Salary then payable to the Executive pursuant to the Employer’s standard payroll practice; (B) continue to pay the Executive an annual Bonus in an amount equal to the average of his most recent three (3) years’ annual Bonus amounts pursuant to the Employer’s standard Bonus payment practices; and (C) continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to the non-extension under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement; provided, however, that in the circumstance where the term of this Agreement is not extended, the Executive must remain employed with the Employer to receive such payments and benefits; further provided, that the continued payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of the notice of non-extension.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(ii)In the event that the term of this Agreement is not extended in accordance with the provisions of Section 1, the Executive may elect to terminate his employment and upon such termination, the Employer shall pay the Executive a lump sum amount equal to nine (9) times the sum of: (A) the monthly Base Salary then payable to the Executive; plus (B) one twelfth (1/12) of the base annual deferred compensation contribution made by the Employer under the Deferred Compensation Plan for the year prior to the Executive’s termination.  The election by the Executive to terminate his employment pursuant to this subparagraph (a)(ii) must be delivered in writing to the Employer within forty-five (45) days of the later of his receipt of notice of the non-extension of the term of this Agreement or December 31st of the year during which such notice is delivered.  Payment to the Executive will be made within thirty (30) days of such termination.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies

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and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(iii)Unless a Change in Control shall have occurred, if the Employer is not in compliance with its minimum capital requirements or if the payments required under subparagraph (i) or (ii) above would cause the Employer’s capital to be reduced below its minimum capital requirements, such payments shall be deferred, as permitted pursuant to Code Section 409A, until such time as the Employer is in capital compliance.

(b)CONSTRUCTIVE DISCHARGE.  If at any time during the term of this Agreement, except in connection with a termination pursuant to paragraph (c) (TERMINATION FOR CAUSE) of this Section 5, the Executive is Constructively Discharged (as hereinafter defined) then the Executive shall have the right, by written notice to the Employer within sixty (60) days of the initial existence of such Constructive Discharge condition, to terminate his services hereunder, effective as of the thirtieth (30th) day after such notice, and the Executive shall have no rights or obligations under this Agreement other than as provided in Sections 4 and 8 hereof; provided, however, the Employer shall have thirty (30) days from the date of such notice in which to cure the condition giving rise to a Constructive Discharge, if curable.  If, during such thirty (30) day period, the Employer cures the condition giving rise to Constructive Discharge, then the Executive’s notice of termination hereunder shall not be effective, the Executive’s employment shall continue until otherwise terminated under this Agreement, and no benefits shall be due under this Agreement with respect to such occurrence.  If the Employer fails to cure the condition giving rise to Constructive Discharge within such thirty (30) day period, the Executive shall be entitled to a lump sum payment of compensation and benefits and continuation of all plans and benefits as if such termination of his employment was pursuant to subparagraph (a)(i) of this Section 5 to be paid within thirty (30) days of the Executive’s termination of employment.

(i)For purposes of this Agreement, the Executive shall be “Constructively Discharged” upon the occurrence of any one of the following events:

(A)The Executive is not re-elected or is removed from the positions with the Employer or any affiliate set forth in Section 1 hereof, other than as a result of the Executive’s election or appointment to positions of equal or superior scope and responsibility; or

(B)The Executive shall fail to be vested by the Employer with the powers and authority of his appointed office; or

(C)The Employer changes the primary employment location of the Executive to a place that is more than thirty (30) miles from the primary employment location as of the Effective Date of this Agreement; or

(D)The Employer otherwise commits a material breach of its obligations under this Agreement.

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(c)TERMINATION FOR CAUSE.  The Executive’s employment hereunder may be terminated for Cause (as hereinafter defined).  “Cause” shall mean:  (i) the Executive’s death; (ii) a material violation by the Executive of any applicable material law or regulation respecting the business of the Employer; (iii) the Executive being found guilty of a felony or an act of dishonesty in connection with the performance of his duties as an officer of the Employer, or which disqualifies the Executive from serving as an officer or director of the Employer; or (iv) the willful or negligent failure of the Executive to perform his duties hereunder in any material respect.  The Executive’s employment under this Agreement may be terminated immediately for any Cause except under (iv) above.  The Executive shall be entitled to at least thirty (30) days’ prior written notice of the Employer’s intention to terminate his employment under (iv) above, specifying the grounds for such termination, a reasonable opportunity to cure any conduct or act, if curable, alleged as grounds for such termination, and a reasonable opportunity to present to the Board his position regarding any dispute relating to the existence of such Cause.  Upon the Executive’s termination for Cause, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of: (A) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (B) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (C) all accrued and unused sick days; and (D) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(d)TERMINATION UPON DEATH.  Upon the Executive’s death, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of: (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the date of death; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) all accrued and unused sick days; and (iv) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments as are provided under the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his death.  Payment shall be made to such beneficiary as the Executive may designate in writing, or failing such designation, to the executor of his estate, in full settlement and satisfaction of all claims and demands on behalf of the Executive.  Such payments shall be in full settlement and satisfaction of all payments provided for in this Agreement.

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(e)TERMINATION UPON CHANGE IN CONTROL.

(i)In the event of a Change in Control and the termination of the Executive’s employment under either (A) or (B) below, the Executive shall be entitled to a lump sum payment equal to three (3) times the sum of the following: (w) his annual Base Salary then payable; plus (x) the average of his most recent three (3) years’ annual Deferred Compensation Plan contributions; plus (y) the average of his most recent three (3) years’ Employer contributions to all Employer-sponsored tax-qualified retirement plans; plus (z) the average of his most recent three (3) years’ annual Bonuses.  The payment of such lump sum shall be paid to the Executive within thirty (30) days of his termination of employment.  In the event of a Change in Control, the Employer shall also provide the Executive with the benefits contemplated in subparagraph (ii) of paragraph (g) (CERTAIN INSURANCE BENEFITS) of this Section 5 below and, upon termination of the Executive’s employment under either (A) or (B) below, shall pay the Executive, within thirty (30) days of termination: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies on reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment If the Executive’s employment has terminated prior to the Change in Control in accordance with the terms of this Agreement and the Employer has made all required payments under any other applicable provision of this Section 5, then no amount shall be paid under this paragraph (e).  Either of the following shall constitute termination under this paragraph:

(A)The Executive terminates his employment by a written notice to that effect delivered to the Employer within twenty-four (24) months after the Change in Control.

(B)The Executive’s employment under this Agreement is terminated by the Employer either in contemplation of or after the Change in Control.

(ii)Notwithstanding the preceding paragraphs of this Section 5 and except as provided in this subparagraph (ii), in the event that it shall be determined that any payment, benefit or other entitlement under this Agreement and any other plan or arrangement of the Employer or the Bank (the “Total Payments”) would constitute an “Excess Parachute Payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and thereby be subject to the excise tax imposed by Section 4999 of the Code or any similar successor provision or any interest or penalties with respect to such excise tax (collectively the “Excise Tax”), then, except in the case of a de Minimus Excess Amount (as defined below), the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes imposed upon the Gross-Up Payment (including any federal, state and local income, payroll and excise taxes and

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any interest or penalties imposed with respect to such taxes), the Executive retains an amount of the Gross Up Payment equal to the Excise Tax imposed upon the Total Payments (not including any Gross-Up Payment).  Such Gross-Up Payment shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the Excise Tax.  If, at a later date, the Internal Revenue Service assesses a deficiency against the Executive for the Excise Tax which is greater than that which was determined at the time such amounts were paid, then the Employer shall pay to the Executive the amount of such unreimbursed Excise Tax plus any interest, penalties and reasonable professional fees or expenses incurred by the Executive as a result of such assessment, including all such taxes with respect to any such additional amount, which amounts shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the deficient Excise Tax.  The highest marginal tax rate applicable to individuals at the time of the payment of such amounts will be used for purposes of determining the federal and state income and other taxes with respect thereto.  The Employer shall withhold from any amounts paid under this Agreement the amount of any Excise Tax or other federal, state or local taxes then required to be withheld.  Computations of the amount of the Gross-Up Payment paid under this subparagraph shall be conclusively made by the Employer’s independent accountants, in consultation, if necessary, with the Employer’s independent legal counsel.  If, after the Executive receives any Gross-Up Payment or other amount pursuant to this subparagraph, the Executive receives any refund with respect to the Excise Tax, the Executive shall promptly pay the Employer the amount of such refund within ten (10) days of receipt by the Executive.  Notwithstanding the foregoing, in the event that the amount by which the present value of the Total Payments which would constitute an Excess Parachute Payment is less than two percent (2%) of the Total Payments, then such Excess Parachute Payment shall be deemed to be a “de Minimus Excess Amount” and the Executive shall not be entitled to a Gross-Up Payment.  In such a case, the Total Payments will be reduced to an amount (the “Non-Triggering Amount”), the value of which is one dollar ($1.00) less than an amount equal to three (3) times the Executive’s “base amount,” as determined in accordance with Code Section 280G; provided, however, that such reduction shall not be made unless the Non-Triggering Amount would be greater than the aggregate value of the Total Payments (without such reduction) minus the amount of Excise Tax required to be paid by the Executive thereon.  The allocation of the reduction required by the preceding sentence shall be determined by the Executive and the Executive shall notify the Employer in writing of the allocation; provided, however, that if the Executive fails to notify the Employer, then the Employer shall make the allocation; and provided further, however, that any such allocation shall not be effective where it would result in an imposition of additional income tax under Code Section 409A.

(iii)For purposes of this Agreement, the term “Change in Control” shall mean any of the following:

(A)The consummation of the acquisition by any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Employer or the Bank; or

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(B)The individuals who, as of the date hereof, are members of the Board of the Employer or the Bank cease for any reason to constitute a majority of the Board, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of a majority of the Board, and such new director shall, for purposes of this Agreement, be considered as a member of the Board; or

(C)Consummation by the Employer or the Bank of:  (1) a merger or consolidation if the shareholders immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of the Employer or the Bank outstanding immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of the Employer or the Bank.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Employer or the Bank is acquired by:  (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the Employer or the Bank; or (2) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders in the same proportion as their ownership of stock of the Employer or the Bank immediately prior to such acquisition.

(f)REGULATORY SUSPENSION AND TERMINATION.

(i)If the Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Employer’s affairs by a notice served under Section 8(e)(3) (12 U.S.C. Section 1818(e)(3)) or 8(g) (12 U.S.C. Section 1818(g)) of the Federal Deposit Insurance Act, as amended, the Employer’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 Employer shall: (A) pay the Executive all of the compensation withheld while the contract obligations were suspended; and (B) reinstate any of the obligations which were suspended.

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

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

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(iv)All obligations of the Employer under this contract shall be terminated, except to the extent determined that continuation of the contract is necessary for the continued operation of the institution by the Federal Deposit Insurance Corporation (the “FDIC”), at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Employer under the authority contained in Section 13(c) (12 U.S.C. Section 1823(c)) of the Federal Deposit Insurance Act, as amended, or when the Employer is determined by the FDIC 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.

(v)Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with Section 18(k) (12 U.S.C. Section 1828(k)) of the Federal Deposit Insurance Act as amended, and any regulations promulgated thereunder.

(g)CERTAIN INSURANCE BENEFITS.

(i)In the event of the termination of the Executive’s employment under this Agreement due to “retirement” (as hereinafter defined), the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death: (A) continuing coverage for the Executive and the Executive’s Spouse under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination); and (B) long term care insurance in accordance with paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.  The term “retirement” for purposes of this paragraph (g) shall mean the Executive:  (a) terminates employment at or after the attainment of age 62; and (b) does not engage in any form of gainful employment on or after his termination of employment.  The continued coverage under this subparagraph (g)(i) shall be for benefits at a level equivalent to the Executive’s benefits at the time of the Executive’s termination of employment. The continued coverage under this subparagraph (g)(i) shall terminate upon the Executive’s engaging in any gainful employment on or after his termination of employment.

(ii)After the occurrence of a Change in Control, the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death: (A) continuing coverage that is equivalent to the coverage provided under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination) maintained by the Employer at the time of the Change in Control; and (B) long term care insurance in accordance with paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.

(iii)In the event of the termination of the Executive’s employment under this Agreement other than as contemplated above in this paragraph (g) or pursuant to paragraph (c) (TERMINATION FOR CAUSE) of Section 5 above, at the election of the Executive (including the estate of the Executive) and the Executive’s Spouse and provided such action is not prohibited by the policy pursuant to which the Executive receives the benefit contemplated in paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above, the Employer shall take all actions

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necessary, including, but not limited to, a transfer and assignment of its interests in the long term health insurance provided to the Executive pursuant to paragraph (f) (LONG TERM CARE INSURANCE) of Section 3 above in order to facilitate the ability of the Executive and the Executive’s Spouse to continue to maintain the long term health insurance at no additional cost to the Employer.

(iv)The payment of premiums for insurance benefits listed in this paragraph (g) shall be remitted to the appropriate carrier no later than thirty (30) days following receipt of the applicable premium invoice.

6.PAYMENT UPON DISABILITY.  If during the term of this Agreement the Executive is deemed to have a Disability (as hereinafter defined), the Employer shall provide the Executive with the payments and benefits set forth in this Section 6.  “Disability,” for purposes of this Agreement shall mean that: (i) the Executive is unable to engage in any substantial gainful activity by reason of 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, or (ii) the Executive is, by reason of 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, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Employer.  The Executive shall be entitled to the compensation and benefits provided for under this Agreement for any period during the term of this Agreement and prior to the establishment of the Executive’s Disability during which the Executive is unable to work due to a physical or mental infirmity.  If the Executive is determined to have a Disability, the Employer shall continue to pay the Executive eighty percent (80%) of the Base Salary per month then payable to the Executive, reduced by any amounts received under the Employer sponsored disability income insurance program, and shall continue to provide coverage for the Executive under the health and life insurance programs maintained by the Employer by the payment of applicable premiums in accordance with the Employer’s standard payment practice until the earlier of the date the Executive returns to full-time employment, either with the Employer or another employer, or the Executive’s normal retirement age under the Social Security Act, as amended.  In addition, if the Executive’s employment is terminated following his Disability, the Employer shall pay the Executive, within thirty (30) days of termination: (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) for all accrued and unused sick days; and (iv) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his termination.  Notwithstanding any other provision of this Agreement, in the event of the termination of the Executive’s employment under this Agreement for any reason, if permitted by law, the Executive may elect to have any disability income insurance policy

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maintained by the Employer on his behalf transferred to him, and he shall assume all obligations thereunder.

7.INTEREST IN ASSETS.  Neither the Executive nor his estate shall acquire hereunder any rights in funds or assets of the Employer, otherwise than by and through the actual payment of amounts payable hereunder; nor shall the Executive or his estate have any power to transfer, assign, anticipate, hypothecate or otherwise encumber in advance any of said payments; nor shall any of such payments be subject to seizure for the payment of any debt, judgment, alimony, separate maintenance or be transferable by operation of law in the event of bankruptcy, insolvency or otherwise of the Executive.

8.INDEMNIFICATION.

(a)INSURANCE.  The Employer shall provide the Executive (including his heirs, personal representatives, executors and administrators) for the term of this Agreement with coverage under a standard directors’ and officers’ liability insurance policy at its expense.

(b)INDEMNIFICATION UNDER STATE LAW.  In addition to the insurance coverage provided for in paragraph (a) of this Section 8, the Employer shall hold harmless and indemnify the Executive (and his heirs, executors and administrators) to the fullest extent permitted under applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been an officer of the Employer (whether or not he continues to be an officer at the time of incurring such expenses or liabilities), such expenses and liabilities to include, but not be limited to, judgments, court costs and attorneys’ fees and the cost of reasonable settlements.

(c)ADVANCEMENT OF EXPENSES.  In the event the Executive becomes a party, or is threatened to be made a party, to any action, suit or proceeding for which the Employer has agreed to provide insurance coverage or indemnification under this Section 8, the Employer shall, to the full extent permitted under applicable law, advance all expenses (including reasonable attorneys’ fees), judgments, fines and amounts paid in settlement (collectively “Expenses”) incurred by the Executive in connection with the investigation, defense, settlement, or appeal of any threatened, pending or completed action, suit or proceeding, subject to receipt by the Employer of a written undertaking from the Executive:  (i) to reimburse the Employer for all Expenses actually paid by the Employer to or on behalf of the Executive in the event it shall be ultimately determined that the Executive is not entitled to indemnification by the Employer for such Expenses; and (ii) to assign to the Employer all rights of the Executive to indemnification, under any policy of directors’ and officers’ liability insurance or otherwise, to the extent of the amount of Expenses actually paid by the Employer to or on behalf of the Executive.

9.GENERAL PROVISIONS.

(a)SUCCESSORS.  This Agreement is personal to the Executive and shall not be assignable by the Executive other than by will or the laws of descent and distribution.  This Agreement shall inure to the benefit of and be enforceable by the Executive’s designated beneficiary, or if none, the Executive’s estate.  This Agreement shall be binding upon and inure

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to the benefit of the Employer and its successors, and any successor of the Employer shall be deemed the “Employer” hereunder.  The Employer shall require any successor to all or substantially all of the business and/or assets of the Employer, whether directly or indirectly, by purchase, merger, consolidation, acquisition of stock, other business combination, or otherwise, by a written agreement in form and substance satisfactory to the Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same extent as the Employer would be required to perform if no such succession had taken place.

(b)ENTIRE AGREEMENT; MODIFICATIONS.  This Agreement, along with the Amended and Restated Life Insurance Agreement and the Participation Agreement under the Deferred Compensation Plan, constitutes the entire agreement between the parties respecting the subject matter hereof, and supersedes all prior employment agreements and all prior negotiations, undertakings, agreements and arrangements with respect hereto, whether written or oral. Except as otherwise explicitly provided herein, this Agreement may not be amended or modified except by written agreement signed by the Executive and the Employer.

(c)ENFORCEMENT AND GOVERNING LAW.  The provisions of this Agreement shall be regarded as divisible and separate; if any of said provisions should be declared invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remaining provisions shall not be affected thereby.  This Agreement shall be construed and the legal relations of the parties hereto shall be determined in accordance with the laws of the State of Illinois without reference to the law regarding conflicts of law.

(d)ARBITRATION.  Any dispute or controversy arising under or in connection with this Agreement or the Executive’s employment by the Employer shall be settled exclusively by arbitration, conducted by a single arbitrator sitting in a location selected by the Executive within fifty (50) miles of the main office of the Employer, in accordance with the rules of JAMS/Endispute (“JAMS”) then in effect.  The arbitrator shall be selected by the parties from a list of arbitrators provided by JAMS, provided that no arbitrator shall be related to or affiliated with either of the parties.  No later than ten (10) days after the list of proposed arbitrators is received by the parties, the parties, or their respective representatives, shall meet at a mutually convenient location or telephonically.  At that meeting, the party who sought arbitration shall eliminate one (1) proposed arbitrator and then the other party shall eliminate one (1) proposed arbitrator.  The parties shall continue to eliminate names from the list of proposed arbitrators in this manner until a single proposed arbitrator remains.  This remaining arbitrator shall arbitrate the dispute.  Each party shall submit, in writing, the specific requested action or decision it wishes to take, or make, with respect to the matter in dispute, and the arbitrator shall be obligated to choose one (1) party’s specific requested action or decision, without being permitted to effectuate any compromise position.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that the Executive shall be entitled to seek specific performance of his right to be paid through the date of termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

(e)LEGAL FEES.  All reasonable legal fees paid or incurred by the Executive pursuant to any dispute or question of interpretation relating to this Agreement shall be paid or reimbursed by the Employer if the Executive is successful on the merits pursuant to a legal judgment, arbitration or settlement.  The Employer shall make any required payment under this paragraph

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(e) as soon as practicable following the time at which such expense and/or fee is incurred, but in no event later than December 31 of the year following the year in which the expense and/or fee is incurred by the Executive.

(f)SURVIVAL.  The provisions of Sections 4 and 8 shall survive the termination of this Agreement.

(g)WAIVER.  No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by the other party shall be deemed a waiver of any similar or dissimilar provisions or conditions at the same time or any prior or subsequent time.

(h)NOTICES.  Notices pursuant to this Agreement shall be in writing and shall be deemed given when received; and, if mailed, shall be mailed by United States registered or certified mail, return receipt requested, postage prepaid; and if to the Employer, addressed to the principal headquarters of the Employer, attention:  Chairman; or, if to the Executive, to the address set forth below the Executive’s signature on this Agreement, or to such other address as the party to be notified shall have given to the other.

(i)INTERNAL REVENUE CODE SECTION 409A.

(i)To the extent that any of the terms and conditions contained herein constitute an amendment or modification of the time or manner of payment under a non-qualified deferred compensation plan (as defined under Code Section 409A), then to the extent necessary under the transitional guidance under Internal Revenue Service Notice 2007-86, this Agreement, as amended, constitutes an amendment to, and a new election under, such deferred compensation plan, in order to properly modify the time or manner of payment consistent with such guidance.

(ii)It is intended that the Agreement shall comply with the provisions of Code Section 409A so as not to subject the Executive to the payment of additional taxes and interest under Code Section 409A.  In furtherance of this intent, this Agreement shall be interpreted, operated and administered in a manner consistent with these intentions, and to the extent that any regulations or other guidance issued under Code Section 409A would result in the Executive being subject to payment of additional income taxes or interest under Code Section 409A, the parties agree to amend the Agreement to maintain to the maximum extent practicable the original intent of the Agreement while avoiding the application of such taxes or interest under Code Section 409A.

(iii)Notwithstanding any provision in the Agreement to the contrary if, as of the effective date of the Executive’s termination of employment, he is a Specified Employee (as hereinafter defined), then, only to the extent required pursuant to Code Section 409A(a)(2)(B)(i), payments due under this Agreement which are deemed to be deferred compensation shall be subject to a six (6) month delay following the Executive’s separation from service.  For purposes of Code Section 409A, all installment payments of deferred compensation made hereunder, or pursuant to another plan or arrangement, shall be deemed to be separate payments and, accordingly, the aforementioned deferral shall only apply to separate payments which would occur during the six (6) month deferral period and all other payments shall be unaffected.  All

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delayed payments shall be accumulated and paid in a lump-sum catch-up payment as of the first day of the seventh-month following separation from service (or, if earlier, the date of death of the Executive) with all such delayed payments being credited with interest (compounded monthly) for this period of delay equal to the prime rate in effect on the first day of such six-month period.  Any portion of the benefits hereunder that were not otherwise due to be paid during the six-month period following the termination shall be paid to the Executive in accordance with the payment schedule established herein.

(iv)The term “Specified Employee” shall mean any person who is a “key employee” (as defined in Code Section 416(i) without regard to paragraph (5) thereof), as determined by the Employer based upon the 12-month period ending on each December 31st (such 12-month period is referred to below as the “identification period”).  If the Executive is determined to be a key employee under Code Section 416(i) (without regard to paragraph (5) thereof) during the identification period he shall be treated as a Specified Employee for purposes of this Agreement during the 12-month period that begins on the April 1 following the close of such identification period.  For purposes of determining whether the Executive is a key employee under Code Section 416(i), “compensation” shall mean the Executive’s W-2 compensation as reported by the Employer for a particular calendar year.

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

WEST SUBURBAN BANCORP, INC.		MICHAEL P. BROSNAHAN
By:	/s/ Duane G. Debs	/s/ Michael P. Brosnahan
Name:	Duane Debs
Title:	President
		(Address)

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EX-10.6

Exhibit 10.6

WEST SUBURBAN BANCORP, INC.

RESTATED EMPLOYMENT AGREEMENT – DANIEL P. GROTTO

This RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), is made and entered into as of the 31st day of December, 2008 (the “Effective Date”), by and between WEST SUBURBAN BANCORP, INC., an Illinois corporation (the “Employer”), and DANIEL P. GROTTO, an Illinois resident (the “Executive”).

R E C I T A L S:

A.The Employer owns all of the issued and outstanding capital stock of West Suburban Bank, Lombard, Illinois (the “Bank”).

B.The Employer desires to continue to employ the Executive as an officer of the Bank for a specified term and the Executive is willing to continue such employment upon the terms and conditions hereinafter set forth.

C.Additionally, the Employer recognizes that circumstances may arise which may result in a change in control of the Employer and/or the Bank (through acquisition or otherwise) thereby causing uncertainty with respect to the Executive’s employment without regard to the competence or past contributions of the Executive and that such uncertainty may result in the loss to the Employer and/or the Bank of the valuable services provided by the Executive.  In such circumstances, the Employer and the Executive wish to provide reasonable security to the Executive against changes in the Executive’s employment relationship with the Employer and/or the Bank.

D.The Executive currently serves as the Senior Vice President, Business Development and Prepaid Solutions of the Bank pursuant to that certain Employment Agreement dated March 8, 2004 (the “Employment Agreement”).

E.The parties desire to amend and restate the Employment Agreement in accordance with the terms, and subject to the conditions, set forth herein in order to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the related U.S. Treasury Department regulations and guidance promulgated thereunder (“Code Section 409A”)

NOW, THEREFORE, in consideration of the promises and of the covenants and agreements hereinafter contained, it is covenanted and agreed by and between the parties hereto as follows:

A G R E E M E N T S:

1.TERM OF EMPLOYMENT WITH AUTOMATIC RENEWAL PROVISIONS.  The period of the Executive’s employment under this Agreement shall be deemed to have commenced on the Effective Date and shall continue for a period of approximately three (3) years through December 31, 2011.  The term of employment of the

Executive under this Agreement shall automatically be extended for one (1) additional year on December 31st of each year beginning December 31, 2009, unless either the Employer or the Executive notifies the other party, by written notice delivered no later than November 1st of such year, that the term of employment of the Executive under this Agreement shall not be extended for an additional year.  In addition, upon the occurrence of a Change in Control (as defined below), the term of employment of the Executive under this Agreement shall be automatically renewed and extended to provide a term of employment (in accordance with the terms, and subject to the conditions, set forth herein) equal to a period of three (3) years from the date of the consummation of the Change in Control.

2.POSITION AND DUTIES.  The Employer hereby continues to employ the Executive as the Senior Vice President, Business Development and Prepaid Solutions of the Bank or in such other senior executive capacity as shall be mutually agreed between the Employer and the Executive.  During the period of the Executive’s employment hereunder, the Executive shall devote his best efforts and full business time, energy, skills and attention to the business and affairs of the Employer and its affiliates, including the Bank.  The Executive’s duties and authority shall consist of and include all duties and authority customarily performed and held by persons holding equivalent positions with business organizations similar in nature and size to the Employer, as such duties and authority are reasonably defined, modified and delegated from time to time by either or both of the Boards of Directors of the Employer (the “Board”) or the Bank.  The Executive shall have the powers necessary to perform the duties assigned to him and shall be provided such supporting services, staff and other assistance, office space and accoutrements as shall be reasonably necessary and appropriate in the light of such assigned duties.

3.COMPENSATION.  As compensation for the services to be provided by the Executive hereunder, the Executive shall receive the following compensation, expense reimbursement and other benefits:

(a)BASE SALARY.  The Executive shall receive an aggregate annual minimum base salary at the rate of two hundred twenty-eight thousand three hundred fifty-five and 30/100 dollars ($228,355.30) payable in installments in accordance with the regular payroll schedule of the Bank (“Base Salary”).  Such Base Salary shall be subject to review annually commencing in 2009 and shall be maintained or increased during the term hereof in accordance with the Employer’s established management compensation policies and practices.

(b)BONUS.  The Executive shall be eligible for an annual bonus (“Bonus”) with respect to each fiscal year of the Employer in accordance with the Employer’s compensation and bonus policies and practices for senior executive officers.  The amount of the Bonus, if any, shall be determined by the Compensation Committee of the Board (the “Compensation Committee”).  The Bonus, if any, shall be paid no later than March 15th of the year following the calendar year in which the Bonus is earned.

(c)DEFERRED COMPENSATION.  The Employer shall make contributions for the benefit of the Executive to the Employer’s Directors and Senior Management Deferred

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Compensation Plan (“Deferred Compensation Plan”), including any successor plan or program thereto, in an annual amount of not less than twenty-five thousand dollars ($25,000).

(d)VACATIONS.  The Executive shall receive paid vacation days of at least such number of paid vacation days as the Executive shall be entitled to receive as of the date hereof in accordance with the Employer’s vacation policy in effect as of the date hereof.  The method of accrual, forfeiture and scheduling of vacation days shall be in accordance with, and subject to, the Employer’s general vacation policies and practices.

(e)LONG TERM CARE INSURANCE.  The Employer shall provide the Executive and the Executive’s spouse with coverage under, and shall pay the premiums with respect to, long term care insurance in accordance with the terms, and subject to the conditions, as the Employer shall provide to other senior executive officers.  The Executive acknowledges that this benefit shall be subject to the continued availability of such long term care insurance from the insurer under which this benefit is provided to other senior executives from time to time.

(f)REIMBURSEMENT OF EXPENSES.  The Executive shall be reimbursed, upon submission of appropriate vouchers and supporting documentation, for all travel, entertainment and other out-of-pocket expenses reasonably and necessarily incurred by the Executive in the performance of his duties hereunder and shall be entitled to attend seminars, conferences and meetings relating to the business of the Employer consistent with the Employer’s established policies in that regard; provided that, such reimbursement will be made as soon as practicable and, when taxable to the Executive, shall be made no later than the end of the calendar year following the year in which the expenses or other charges were incurred.

(g)OTHER BENEFITS.  The Executive shall be entitled to all benefits specifically established for him and, when and to the extent he is eligible therefor, to participate in all plans and benefits generally accorded to senior executives of the Employer, including, but not limited to the following to the extent provided, if at all, to other senior executives of the Employer:  pension; profit-sharing; employee stock ownership plan; supplemental retirement; incentive compensation; bonus; disability income; split-dollar life insurance; group life; health, medical (including dental, vision and prescription drug insurance, if any) and hospitalization insurance; long term care insurance; and similar or comparable plans, and also to perquisites extended to similarly situated senior executives; provided, however, that such plans, benefits and perquisites shall be no less than those made available to all other employees of the Employer.

(h)WITHHOLDING.  The Employer shall be entitled to withhold from amounts payable to the Executive hereunder, any federal, state or local withholding or other taxes or charges which it is from time to time required to withhold.  The Employer shall be entitled to rely upon the opinion of its legal counsel with regard to any question concerning the amount or requirement of any such withholding.

4.CONFIDENTIALITY AND LOYALTY.  The Executive acknowledges that heretofore or hereafter during the course of his employment he has produced and may hereafter produce and have access to material, records, data, trade secrets and information not generally available to the public (collectively, “Confidential Information”) regarding the Employer and its subsidiaries and affiliates.  Accordingly, during and subsequent to termination of this

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Agreement, the Executive shall hold in confidence and not directly or indirectly disclose, use, copy or make lists of any such Confidential Information, except to the extent that such information is or thereafter becomes lawfully available from public sources, or such disclosure is authorized in writing by the Employer, required by a law or any competent administrative agency or judicial authority, or otherwise as reasonably necessary or appropriate in connection with performance by the Executive of his duties hereunder.  All records, files, documents and other materials or copies thereof relating to the Employer’s business which the Executive shall prepare or use, shall be and remain the sole property of the Employer, shall not be removed from the Employer’s premises without its written consent, and shall be promptly returned to the Employer upon termination of the Executive’s employment hereunder.  The Executive agrees to abide by the Employer’s reasonable policies, as in effect from time to time, respecting avoidance of interests conflicting with those of the Employer.  In the event of any violation or threatened violation of these restrictions, the Employer, in addition to and not in limitation of being relieved of all further obligations under this Agreement and of any other rights, remedies or damages available to the Employer under this Agreement or otherwise at law or in equity, shall be entitled to preliminary and permanent injunctive relief to prevent or restrain any such violation by the Executive and any and all persons directly or indirectly acting for or with him, as the case may be.

5.TERMINATION.  The Executive’s employment during the term of this Agreement may be terminated by the Employer or the Executive without any breach of this Agreement only under the circumstances described in this Section 5 (where such termination constitutes a “separation from service” pursuant to Code Section 409A):

(a)AGREEMENT NON-EXTENSION OR EMPLOYMENT TERMINATION BY THE EMPLOYER AND TERMINATION BY THE EXECUTIVE.

(i)In the event of the termination of the Executive’s employment under this Agreement by the Employer prior to the last day of the then current term for any reason other than a termination in accordance with the provisions of paragraph (c) of this Section 5 (TERMINATION FOR CAUSE), the Employer shall pay the Executive a lump sum payment equal to the sum of the amount of his Base Salary payable for the remainder of the current term, plus the amount of the Executive’s annual Bonus(es) payable for the remainder of the current term based on an amount equal to the average of his most recent three (3) years’ annual Bonus amounts.  Such payment shall be paid to the Executive within thirty (30) days of the Executive’s termination of employment.  In addition, the Employer shall continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to his termination of employment under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement, provided, however, that the payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of termination.  In the event of a non-extension of this Agreement by the Employer in accordance with the provisions of Section 1, the Employer shall:  (A) continue to pay the Executive the Base Salary then payable to the Executive pursuant to the Employer’s standard payroll practice; (B) continue to pay the

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Executive an annual Bonus in an amount equal to the average of his most recent three (3) years’ annual Bonus amounts pursuant to the Employer’s standard Bonus payment practices; and (C) continue to provide coverage for the Executive at the same or equivalent level as the Executive’s coverage prior to the non-extension under all plans and benefits otherwise provided to senior executives of the Employer (including without limitation, group health, life, disability and long term care insurance coverage, club dues, and Deferred Compensation Plan contributions) by payment of the applicable premiums and reimbursements in accordance with the Employer’s standard payment practice, unless unable to continue such coverage by law, for the remainder of the term of this Agreement; provided, however, that in the circumstance where the term of this Agreement is not extended, the Executive must remain employed with the Employer to receive such payments and benefits; further provided, that the continued payment of these amounts by the Employer shall not offset or diminish any compensation or benefits accrued as of the date of the notice of non-extension.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(ii)In the event that the term of this Agreement is not extended in accordance with the provisions of Section 1, the Executive may elect to terminate his employment and upon such termination, the Employer shall pay the Executive a lump sum amount equal to nine (9) times the sum of: (A) the monthly Base Salary then payable to the Executive; plus (B) one twelfth (1/12) of the base annual deferred compensation contribution made by the Employer under the Deferred Compensation Plan for the year prior to the Executive’s termination.  The election by the Executive to terminate his employment pursuant to this subparagraph (a)(ii) must be delivered in writing to the Employer within forty-five (45) days of the later of his receipt of notice of the non-extension of the term of this Agreement or December 31st of the year during which such notice is delivered.  Payment to the Executive will be made within thirty (30) days of such termination.  In addition, within thirty (30) days of the Executive’s termination of employment, the Employer shall pay the Executive: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as

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amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(iii)Unless a Change in Control shall have occurred, if the Employer is not in compliance with its minimum capital requirements or if the payments required under subparagraph (i) or (ii) above would cause the Employer’s capital to be reduced below its minimum capital requirements, such payments shall be deferred, as permitted pursuant to Code Section 409A, until such time as the Employer is in capital compliance.

(b)CONSTRUCTIVE DISCHARGE.  If at any time during the term of this Agreement, except in connection with a termination pursuant to paragraph (c) (TERMINATION FOR CAUSE) of this Section 5, the Executive is Constructively Discharged (as hereinafter defined) then the Executive shall have the right, by written notice to the Employer within sixty (60) days of the initial existence of such Constructive Discharge condition, to terminate his services hereunder, effective as of the thirtieth (30th) day after such notice, and the Executive shall have no rights or obligations under this Agreement other than as provided in Sections 4 and 8 hereof; provided, however, the Employer shall have thirty (30) days from the date of such notice in which to cure the condition giving rise to a Constructive Discharge, if curable.  If, during such thirty (30) day period, the Employer cures the condition giving rise to Constructive Discharge, then the Executive’s notice of termination hereunder shall not be effective, the Executive’s employment shall continue until otherwise terminated under this Agreement, and no benefits shall be due under this Agreement with respect to such occurrence.  If the Employer fails to cure the condition giving rise to Constructive Discharge within such thirty (30) day period, the Executive shall be entitled to a lump sum payment of compensation and benefits and continuation of all plans and benefits as if such termination of his employment was pursuant to subparagraph (a)(i) of this Section 5 to be paid within thirty (30) days of the Executive’s termination of employment.

(i)For purposes of this Agreement, the Executive shall be “Constructively Discharged” upon the occurrence of any one of the following events:

(A)The Executive is not re-elected or is removed from the positions with the Employer or any affiliate set forth in Section 1 hereof, other than as a result of the Executive’s election or appointment to positions of equal or superior scope and responsibility; or

(B)The Executive shall fail to be vested by the Employer with the powers and authority of his appointed office; or

(C)The Employer changes the primary employment location of the Executive to a place that is more than thirty (30) miles from the primary employment location as of the Effective Date of this Agreement; or

(D)The Employer otherwise commits a material breach of its obligations under this Agreement.

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(c)TERMINATION FOR CAUSE.  The Executive’s employment hereunder may be terminated for Cause (as hereinafter defined).  “Cause” shall mean:  (i) the Executive’s death; (ii) a material violation by the Executive of any applicable material law or regulation respecting the business of the Employer; (iii) the Executive being found guilty of a felony or an act of dishonesty in connection with the performance of his duties as an officer of the Employer, or which disqualifies the Executive from serving as an officer or director of the Employer; or (iv) the willful or negligent failure of the Executive to perform his duties hereunder in any material respect.  The Executive’s employment under this Agreement may be terminated immediately for any Cause except under (iv) above.  The Executive shall be entitled to at least thirty (30) days’ prior written notice of the Employer’s intention to terminate his employment under (iv) above, specifying the grounds for such termination, a reasonable opportunity to cure any conduct or act, if curable, alleged as grounds for such termination, and a reasonable opportunity to present to the Board his position regarding any dispute relating to the existence of such Cause.  Upon the Executive’s termination for Cause, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of: (A) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (B) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (C) all accrued and unused sick days; and (D) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.

(d)TERMINATION UPON DEATH.  Upon the Executive’s death, the Employer shall have no obligations to the Executive other than payment, within thirty (30) days, of: (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the date of death; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) all accrued and unused sick days; and (iv) reimbursement for previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  In addition,  the Executive shall also have such rights to payments as are provided under the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his death.  Payment shall be made to such beneficiary as the Executive may designate in writing, or failing such designation, to the executor of his estate, in full settlement and satisfaction of all claims and demands on behalf of the Executive.  Such payments shall be in full settlement and satisfaction of all payments provided for in this Agreement.

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(e)TERMINATION UPON CHANGE IN CONTROL.

(i)In the event of a Change in Control and the termination of the Executive’s employment under either (A) or (B) below, the Executive shall be entitled to a lump sum payment equal to three (3) times the sum of the following:  (w) his annual Base Salary then payable; plus (x) the average of his most recent three (3) years’ annual Deferred Compensation Plan contributions; plus (y) the average of his most recent three (3) years’ Employer contributions to all Employer-sponsored tax-qualified retirement plans; plus (z) the average of his most recent three (3) years’ annual Bonuses.  The payment of such lump sum shall be paid to the Executive within thirty (30) days of his termination of employment.  In the event of a Change in Control, the Employer shall also provide the Executive with the benefits contemplated in subparagraph (ii) of paragraph (g) (CERTAIN INSURANCE BENEFITS) of this Section 5 below and, upon termination of the Executive’s employment under either (A) or (B) below, shall pay the Executive, within thirty (30) days of termination: (a) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (b) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (c) for all accrued and unused sick days; and (d)  reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies on reimbursement of expenses.  In addition, the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of the termination of his employment.  If the Executive’s employment has terminated prior to the Change in Control in accordance with the terms of this Agreement and the Employer has made all required payments under any other applicable provision of this Section 5, then no amount shall be paid under this paragraph (e).  Either of the following shall constitute termination under this paragraph:

(A)The Executive terminates his employment by a written notice to that effect delivered to the Employer within twenty-four (24) months after the Change in Control.

(B)The Executive’s employment under this Agreement is terminated by the Employer either in contemplation of or after the Change in Control.

(ii)Notwithstanding the preceding paragraphs of this Section 5 and except as provided in this subparagraph (ii), in the event that it shall be determined that any payment, benefit or other entitlement under this Agreement and any other plan or arrangement of the Employer or the Bank (the “Total Payments”) would constitute an “Excess Parachute Payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and thereby be subject to the excise tax imposed by Section 4999 of the Code or any similar successor provision or any interest or penalties with respect to such excise tax (collectively the “Excise Tax”), then, except in the case of a de Minimus Excess Amount (as defined below), the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes imposed upon the

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Gross-Up Payment (including any federal, state and local income, payroll and excise taxes and any interest or penalties imposed with respect to such taxes), the Executive retains an amount of the Gross Up Payment equal to the Excise Tax imposed upon the Total Payments (not including any Gross-Up Payment).  Such Gross-Up Payment shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the Excise Tax.  If, at a later date, the Internal Revenue Service assesses a deficiency against the Executive for the Excise Tax which is greater than that which was determined at the time such amounts were paid, then the Employer shall pay to the Executive the amount of such unreimbursed Excise Tax plus any interest, penalties and reasonable professional fees or expenses incurred by the Executive as a result of such assessment, including all such taxes with respect to any such additional amount, which amounts shall be paid to the Executive no later than the end of the Executive’s taxable year following the taxable year in which the Executive remits the deficient Excise Tax.  The highest marginal tax rate applicable to individuals at the time of the payment of such amounts will be used for purposes of determining the federal and state income and other taxes with respect thereto.  The Employer shall withhold from any amounts paid under this Agreement the amount of any Excise Tax or other federal, state or local taxes then required to be withheld.  Computations of the amount of the Gross-Up Payment paid under this subparagraph shall be conclusively made by the Employer’s independent accountants, in consultation, if necessary, with the Employer’s independent legal counsel.  If, after the Executive receives any Gross-Up Payment or other amount pursuant to this subparagraph, the Executive receives any refund with respect to the Excise Tax, the Executive shall promptly pay the Employer the amount of such refund within ten (10) days of receipt by the Executive.  Notwithstanding the foregoing, in the event that the amount by which the present value of the Total Payments which would constitute an Excess Parachute Payment is less than two percent (2%) of the Total Payments, then such Excess Parachute Payment shall be deemed to be a “de Minimus Excess Amount” and the Executive shall not be entitled to a Gross-Up Payment.  In such a case, the Total Payments will be reduced to an amount (the “Non-Triggering Amount”), the value of which is one dollar ($1.00) less than an amount equal to three (3) times the Executive’s “base amount,” as determined in accordance with Code Section 280G; provided, however, that such reduction shall not be made unless the Non-Triggering Amount would be greater than the aggregate value of the Total Payments (without such reduction) minus the amount of Excise Tax required to be paid by the Executive thereon.  The allocation of the reduction required by the preceding sentence shall be determined by the Executive and the Executive shall notify the Employer in writing of the allocation; provided, however, that if the Executive fails to notify the Employer, then the Employer shall make the allocation; and provided further, however, that any such allocation shall not be effective where it would result in an imposition of additional income tax under Code Section 409A.

(iii)For purposes of this Agreement, the term “Change in Control” shall mean any of the following:

(A)The consummation of the acquisition by any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Employer or the Bank; or

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(B)The individuals who, as of the date hereof, are members of the Board of the Employer or the Bank cease for any reason to constitute a majority of the Board, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of a majority of the Board, and such new director shall, for purposes of this Agreement, be considered as a member of the Board; or

(C)Consummation by the Employer or the Bank of:  (1) a merger or consolidation if the shareholders immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of the Employer or the Bank outstanding immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of the Employer or the Bank.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Employer or the Bank is acquired by:  (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the Employer or the Bank; or (2) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders in the same proportion as their ownership of stock of the Employer or the Bank immediately prior to such acquisition.

(f)REGULATORY SUSPENSION AND TERMINATION.

(i)If the Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Employer’s affairs by a notice served under Section 8(e)(3) (12 U.S.C. Section 1818(e)(3)) or 8(g) (12 U.S.C. Section 1818(g)) of the Federal Deposit Insurance Act, as amended, the Employer’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 Employer shall: (A) pay the Executive all of the compensation withheld while the contract obligations were suspended; and (B) reinstate any of the obligations which were suspended.

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

(iii)If the Employer is in default as defined in Section 3(x) (12 U.S.C. Section 1813(x)(1)) of the Federal Deposit Insurance Act, as amended, all obligations of the

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Employer under this contract shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

(iv)All obligations of the Employer under this contract shall be terminated, except to the extent determined that continuation of the contract is necessary for the continued operation of the institution by the Federal Deposit Insurance Corporation (the “FDIC”), at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Employer under the authority contained in Section 13(c) (12 U.S.C. Section 1823(c)) of the Federal Deposit Insurance Act, as amended, or when the Employer is determined by the FDIC 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.

(v)Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with Section 18(k) (12 U.S.C. Section 1828(k)) of the Federal Deposit Insurance Act as amended, and any regulations promulgated thereunder.

(g)CERTAIN INSURANCE BENEFITS.

(i)In the event of the termination of the Executive’s employment under this Agreement due to “retirement” (as hereinafter defined), the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death: (A) continuing coverage for the Executive and the Executive’s Spouse under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination); and (B) long term care insurance in accordance with paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.  The term “retirement” for purposes of this paragraph (g) shall mean the Executive:  (a) terminates employment at or after the attainment of age 62; and (b) does not engage in any form of gainful employment on or after his termination of employment.  The continued coverage under this subparagraph (g)(i) shall be for benefits at a level equivalent to the Executive’s benefits at the time of the Executive’s termination of employment. The continued coverage under this subparagraph (g)(i)  shall terminate upon the Executive’s engaging in any gainful employment on or after his termination of employment.

(ii)After the occurrence of a Change in Control, the Employer shall continue to provide the following benefits to the Executive, at the expense of the Employer, until the Executive’s death: (A) continuing coverage that is equivalent to the coverage provided under the Employer’s health, medical, hospitalization and life insurance programs (including dental, vision and prescription drug coverage, if provided immediately prior to the termination) maintained by the Employer at the time of the Change in Control; and (B) long term care insurance in accordance with paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above including making all required payments relating to such insurance coverage.

(iii)In the event of the termination of the Executive’s employment under this Agreement other than as contemplated above in this paragraph (g) or pursuant to paragraph (c) (TERMINATION FOR CAUSE) of Section 5 above, at the election of the Executive

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(including the estate of the Executive) and the Executive’s Spouse and provided such action is not prohibited by the policy pursuant to which the Executive receives the benefit contemplated in paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above, the Employer shall take all actions necessary, including, but not limited to, a transfer and assignment of its interests in the long term health insurance provided to the Executive pursuant to paragraph (e) (LONG TERM CARE INSURANCE) of Section 3 above in order to facilitate the ability of the Executive and the Executive’s Spouse to continue to maintain the long term health insurance at no additional cost to the Employer.

(iv)The payment of premiums for insurance benefits listed in this paragraph (g) shall be remitted to the appropriate carrier no later than thirty (30) days following receipt of the applicable premium invoice.

6.PAYMENT UPON DISABILITY.  If during the term of this Agreement the Executive is deemed to have a Disability (as hereinafter defined), the Employer shall provide the Executive with the payments and benefits set forth in this Section 6.  “Disability,” for purposes of this Agreement shall mean that: (i) the Executive is unable to engage in any substantial gainful activity by reason of 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, or (ii) the Executive is, by reason of 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, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Employer.  The Executive shall be entitled to the compensation and benefits provided for under this Agreement for any period during the term of this Agreement and prior to the establishment of the Executive’s Disability during which the Executive is unable to work due to a physical or mental infirmity.  If the Executive is determined to have a Disability, the Employer shall continue to pay the Executive eighty percent (80%) of the Base Salary per month then payable to the Executive, reduced by any amounts received under the Employer sponsored disability income insurance program, and shall continue to provide coverage for the Executive under the health and life insurance programs maintained by the Employer by the payment of applicable premiums in accordance with the Employer’s standard payment practice until the earlier of the date the Executive returns to full-time employment, either with the Employer or another employer, or the Executive’s normal retirement age under the Social Security Act, as amended.  In addition, if the Executive’s employment is terminated following his Disability, the Employer shall pay the Executive, within thirty (30) days of termination: (i) such Base Salary and vacation pay (for unused vacation days in accordance with the Employer’s policies and practices with respect to vacation pay) as shall have accrued and remains unpaid through the effective date of the termination; (ii) Bonuses previously determined by the Compensation Committee for any prior fiscal year(s) that remain unpaid; (iii) for all accrued and unused sick days; and (iv) reimbursement of previously incurred expenses eligible for reimbursement pursuant to the Employer’s policies and practices concerning reimbursement of expenses.  Further provided, that the Executive shall also have such rights to payments, if any, as are provided under the terms of the Deferred Compensation Plan, the Amended and Restated Life Insurance Agreement entered into by and between the Employer and the Executive and as amended from time to time and such retirement plans under which the Executive participated at the time of his termination.  Notwithstanding any other provision of this Agreement, in the event

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of the termination of the Executive’s employment under this Agreement for any reason, if permitted by law, the Executive may elect to have any disability income insurance policy maintained by the Employer on his behalf transferred to him, and he shall assume all obligations thereunder.

7.INTEREST IN ASSETS.  Neither the Executive nor his estate shall acquire hereunder any rights in funds or assets of the Employer, otherwise than by and through the actual payment of amounts payable hereunder; nor shall the Executive or his estate have any power to transfer, assign, anticipate, hypothecate or otherwise encumber in advance any of said payments; nor shall any of such payments be subject to seizure for the payment of any debt, judgment, alimony, separate maintenance or be transferable by operation of law in the event of bankruptcy, insolvency or otherwise of the Executive.

8.INDEMNIFICATION.

(a)INSURANCE.  The Employer shall provide the Executive (including his heirs, personal representatives, executors and administrators) for the term of this Agreement with coverage under a standard directors’ and officers’ liability insurance policy at its expense.

(b)INDEMNIFICATION UNDER STATE LAW.  In addition to the insurance coverage provided for in paragraph (a) of this Section 8, the Employer shall hold harmless and indemnify the Executive (and his heirs, executors and administrators) to the fullest extent permitted under applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been an officer of the Employer (whether or not he continues to be an officer at the time of incurring such expenses or liabilities), such expenses and liabilities to include, but not be limited to, judgments, court costs and attorneys’ fees and the cost of reasonable settlements.

(c)ADVANCEMENT OF EXPENSES.  In the event the Executive becomes a party, or is threatened to be made a party, to any action, suit or proceeding for which the Employer has agreed to provide insurance coverage or indemnification under this Section 8, the Employer shall, to the full extent permitted under applicable law, advance all expenses (including reasonable attorneys’ fees), judgments, fines and amounts paid in settlement (collectively “Expenses”) incurred by the Executive in connection with the investigation, defense, settlement, or appeal of any threatened, pending or completed action, suit or proceeding, subject to receipt by the Employer of a written undertaking from the Executive:  (i) to reimburse the Employer for all Expenses actually paid by the Employer to or on behalf of the Executive in the event it shall be ultimately determined that the Executive is not entitled to indemnification by the Employer for such Expenses; and (ii) to assign to the Employer all rights of the Executive to indemnification, under any policy of directors’ and officers’ liability insurance or otherwise, to the extent of the amount of Expenses actually paid by the Employer to or on behalf of the Executive.

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9.GENERAL PROVISIONS.

(a)SUCCESSORS.  This Agreement is personal to the Executive and shall not be assignable by the Executive other than by will or the laws of descent and distribution.  This Agreement shall inure to the benefit of and be enforceable by the Executive’s designated beneficiary, or if none, the Executive’s estate.  This Agreement shall be binding upon and inure to the benefit of the Employer and its successors, and any successor of the Employer shall be deemed the “Employer” hereunder.  The Employer shall require any successor to all or substantially all of the business and/or assets of the Employer, whether directly or indirectly, by purchase, merger, consolidation, acquisition of stock, other business combination, or otherwise, by a written agreement in form and substance satisfactory to the Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same extent as the Employer would be required to perform if no such succession had taken place.

(b)ENTIRE AGREEMENT; MODIFICATIONS.  This Agreement, along with the Amended and Restated Life Insurance Agreement and the Participation Agreement under the Deferred Compensation Plan, constitutes the entire agreement between the parties respecting the subject matter hereof, and supersedes all prior employment agreements and all prior negotiations, undertakings, agreements and arrangements with respect hereto, whether written or oral. Except as otherwise explicitly provided herein, this Agreement may not be amended or modified except by written agreement signed by the Executive and the Employer.

(c)ENFORCEMENT AND GOVERNING LAW.  The provisions of this Agreement shall be regarded as divisible and separate; if any of said provisions should be declared invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remaining provisions shall not be affected thereby.  This Agreement shall be construed and the legal relations of the parties hereto shall be determined in accordance with the laws of the State of Illinois without reference to the law regarding conflicts of law.

(d)ARBITRATION.  Any dispute or controversy arising under or in connection with this Agreement or the Executive’s employment by the Employer shall be settled exclusively by arbitration, conducted by a single arbitrator sitting in a location selected by the Executive within fifty (50) miles of the main office of the Employer, in accordance with the rules of JAMS/Endispute (“JAMS”) then in effect.  The arbitrator shall be selected by the parties from a list of arbitrators provided by JAMS, provided that no arbitrator shall be related to or affiliated with either of the parties.  No later than ten (10) days after the list of proposed arbitrators is received by the parties, the parties, or their respective representatives, shall meet at a mutually convenient location or telephonically.  At that meeting, the party who sought arbitration shall eliminate one (1) proposed arbitrator and then the other party shall eliminate one (1) proposed arbitrator.  The parties shall continue to eliminate names from the list of proposed arbitrators in this manner until a single proposed arbitrator remains.  This remaining arbitrator shall arbitrate the dispute.  Each party shall submit, in writing, the specific requested action or decision it wishes to take, or make, with respect to the matter in dispute, and the arbitrator shall be obligated to choose one (1) party’s specific requested action or decision, without being permitted to effectuate any compromise position.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that the Executive shall be entitled to seek specific

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performance of his right to be paid through the date of termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

(e)LEGAL FEES.  All reasonable legal fees paid or incurred by the Executive pursuant to any dispute or question of interpretation relating to this Agreement shall be paid or reimbursed by the Employer if the Executive is successful on the merits pursuant to a legal judgment, arbitration or settlement.  The Employer shall make any required payment under this paragraph (e) as soon as practicable following the time at which such expense and/or fee is incurred, but in no event later than December 31 of the year following the year in which the expense and/or fee is incurred by the Executive.

(f)SURVIVAL.  The provisions of Sections 4 and 8 shall survive the termination of this Agreement.

(g)WAIVER.  No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by the other party, shall be deemed a waiver of any similar or dissimilar provisions or conditions at the same time or any prior or subsequent time.

(h)NOTICES.  Notices pursuant to this Agreement shall be in writing and shall be deemed given when received; and, if mailed, shall be mailed by United States registered or certified mail, return receipt requested, postage prepaid; and if to the Employer, addressed to the principal headquarters of the Employer, attention:  Chairman; or, if to the Executive, to the address set forth below the Executive’s signature on this Agreement, or to such other address as the party to be notified shall have given to the other.

(i)INTERNAL REVENUE CODE SECTION 409A.

(i)To the extent that any of the terms and conditions contained herein constitute an amendment or modification of the time or manner of payment under a non-qualified deferred compensation plan (as defined under Code Section 409A), then to the extent necessary under the transitional guidance under Internal Revenue Service Notice 2007-86, this Agreement, as amended, constitutes an amendment to, and a new election under, such deferred compensation plan, in order to properly modify the time or manner of payment consistent with such guidance.

(ii)It is intended that the Agreement shall comply with the provisions of Code Section 409A so as not to subject the Executive to the payment of additional taxes and interest under Code Section 409A.  In furtherance of this intent, this Agreement shall be interpreted, operated and administered in a manner consistent with these intentions, and to the extent that any regulations or other guidance issued under Code Section 409A would result in the Executive being subject to payment of additional income taxes or interest under Code Section 409A, the parties agree to amend the Agreement to maintain to the maximum extent practicable the original intent of the Agreement while avoiding the application of such taxes or interest under Code Section 409A.

(iii)Notwithstanding any provision in the Agreement to the contrary if, as of the effective date of the Executive’s termination of employment, he is a Specified Employee (as hereinafter defined), then, only to the extent required pursuant to Code Section 

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409A(a)(2)(B)(i), payments due under this Agreement which are deemed to be deferred compensation shall be subject to a six (6) month delay following the Executive’s separation from service.  For purposes of Code Section 409A, all installment payments of deferred compensation made hereunder, or pursuant to another plan or arrangement, shall be deemed to be separate payments and, accordingly, the aforementioned deferral shall only apply to separate payments which would occur during the six (6) month deferral period and all other payments shall be unaffected.  All delayed payments shall be accumulated and paid in a lump-sum catch-up payment as of the first day of the seventh-month following separation from service (or, if earlier, the date of death of the Executive) with all such delayed payments being credited with interest (compounded monthly) for this period of delay equal to the prime rate in effect on the first day of such six-month period.  Any portion of the benefits hereunder that were not otherwise due to be paid during the six-month period following the termination shall be paid to the Executive in accordance with the payment schedule established herein.

(iv)The term “Specified Employee” shall mean any person who is a “key employee” (as defined in Code Section 416(i) without regard to paragraph (5) thereof), as determined by the Employer based upon the 12-month period ending on each December 31st (such 12-month period is referred to below as the “identification period”).  If the Executive is determined to be a key employee under Code Section 416(i) (without regard to paragraph (5) thereof) during the identification period he shall be treated as a Specified Employee for purposes of this Agreement during the 12-month period that begins on the April 1 following the close of such identification period.  For purposes of determining whether the Executive is a key employee under Code Section 416(i), “compensation” shall mean the Executive’s W-2 compensation as reported by the Employer for a particular calendar year.

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

WEST SUBURBAN BANCORP, INC.		DANIEL P. GROTTO
By:	/s/ Duane G. Debs	/s/ Daniel P. Grotto
Name:	Duane Debs
Title:	President
		(Address)

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EX-10.7

Exhibit 10.7

AMENDED AND RESTATED
LIFE INSURANCE AGREEMENT

PREMISES

A.Effective the 13th day of November, 1990, West Suburban Bancorp, Inc., a banking organization organized and existing under the laws of the State of Illinois (“Corporation”), and [Executive Name], a Key Employee and Executive of the Corporation (“Executive”), entered into a Deferred Compensation and Split-Dollar Insurance Agreement and amended and restated the agreement in its entirety, effective April 12, 2001 (“2001 Amended and Restated Life Insurance Agreement”). Pursuant to the terms thereof, the Corporation and the Executive reserved the right to modify or amend the 2001 Amended and Restated Life Insurance Agreement.  By execution hereof, the Corporation and Executive hereby amend and restate that agreement in its entirety, effective March 8, 2004 (“Amended and Restated Life Insurance Agreement”).

B.It is the consensus of the Board of Directors of the Corporation that Executive’s services are of exceptional merit, in excess of the compensation paid and an invaluable contribution to the profits and position of the Corporation in its field of activity.

C.It is the mutual desire of the Corporation and the Executive that Executive remain in the employ of the Corporation, and to maintain a program to provide pre-retirement and postretirement death benefits for the Executive. Accordingly, it is the desire of the Corporation and the Executive to enter into this Amended and Restated Life Insurance Agreement under which the Corporation will agree to pay a death benefit to the Executive’s beneficiaries in the event of his death.

D.Therefore, in consideration of Executive’s services to be performed in the future, and based upon the mutual promises and covenants herein contained, the Corporation and Executive agree as follows.

ARTICLE 1
Definitions

1.1Effective Date.  The effective date of this Amended and Restated Life Insurance Agreement shall be March 8, 2004.

1.2Change in Control.  The first to occur of any of the following events:

(a)The consummation of the acquisition by any person (as such term is defined in Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Employer or the Bank; or

(b)The individuals who, as of the date hereof, are members of the Board of the Employer or the Bank cease for any reason to constitute a majority of the Board, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of a majority of the Board, and such new director shall, for purposes of this Amended and Restated Life Insurance Agreement, be considered as a member of the Board; or

(c)Approval by shareholders of the Employer or the Bank of:  (1) a merger or consolidation if the shareholders immediately before such merger or consolidation do not, as a result of such merger or consolidation, own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the entity resulting from such merger or consolidation in substantially the same proportion as their ownership of the combined voting power of the voting securities of the Employer or the Bank outstanding immediately before such merger or consolidation; or (2) a complete liquidation or dissolution or an agreement for the sale or other disposition of all or substantially all of the assets of the Employer or the Bank.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Employer or the Bank is acquired by:  (1) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained for employees of the Employer or the Bank; or (2) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the shareholders in the same proportion as their ownership of stock of the Employer or the Bank immediately prior to such acquisition.

1.3Covered Termination.  The voluntary or involuntary severing of employment with the Corporation (i) prior to the attainment of age fifty (50), and (ii) following a Change in Control.

1.4Disability.  The Executive’s suffering a sickness, accident or injury which has been determined by the carrier of any individual or group disability insurance policy covering the Executive, or by the Social Security Administration, to be a disability rendering the Executive totally and permanently disabled.  The Executive must submit proof to the Corporation of the carrier’s or Social Security Administration’s determination upon the request of the Corporation.

1.5Insurer.  Nationwide Life and Annuity Insurance Company.

1.6Policy.  Policy #[number] issued by the Insurer.

1.7Retirement.  Termination of employment from the Corporation on or after the attainment of age fifty (50).

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1.8Termination of Employment.  The voluntary or involuntary severing of employment with the Corporation prior to Retirement for any reason other than death, Disability or a Covered Termination.

ARTICLE 2
Life Insurance

2.1Executive’s Interest.  Provided this Amended and Restated Life Insurance Agreement has not terminated pursuant to Section 3.3, the Executive shall have the right to designate a beneficiary for a portion of the Policy’s proceeds as follows:

(a)If the Executive dies while covered under this Amended and Restated Life Insurance Agreement and while actively employed by the Corporation, the Executive’s beneficiary shall receive a death benefit of $750,000.

(b)If the Executive dies while covered under this Amended and Restated Life Insurance Agreement but after his Retirement, the Executive’s beneficiary shall receive a death benefit of $375,000.

(c)If the Executive dies while covered under this Amended and Restated Life Insurance Agreement and after a Disability, the Executive’s beneficiary shall receive a death benefit of (i) $750,000 if such death occurs prior to the attainment of age 50, or (ii) $375,000 if such death occurs on or after the attainment of age 50.

(d)If the Executive dies while covered under this Amended and Restated Life Insurance Agreement but after he experiences a Covered Termination, the Executive’s beneficiary shall receive a death benefit of $375,000.

(e)If the Executive experiences a Termination of Employment, the Executive, the Executive’s transferee, and the Executive’s beneficiary shall have no rights or interest in the Policy with respect to that portion of the death proceeds designated in this Section 2.1

(f)Upon the Executive’s death, the Corporation and the Executive’s beneficiary shall execute such forms and furnish such other documents or information as are required to receive payment under the Policy.

2.2Premium Payment and Tax.  All premiums due on the Policy shall be paid by the Corporation. However, Executive shall be responsible for the income taxes incurred each year on the value of the “economic benefit” of the life insurance protection under the Policy. The corporation shall, in its sole discretion, determine the value of such life insurance protection for federal income tax purposes. Such amount shall be calculated pursuant to then current applicable authority.

2.3Corporation Ownership.  The Corporation shall be the sole owner of the Policy and shall have the right to exercise all incidents of ownership, except that Executive shall

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have the right to designate the beneficiary to receive the death benefit described in Section 2.1 above. The Corporation shall be the direct beneficiary of any death proceeds remaining after the Executive’s interest is determined according to Section 2.1.

2.4Insurer.  The Insurer shall be bound only by the terms of the Policy. Any payments the Insurer makes or actions it takes in accordance with the Policy shall fully discharge it from all claims, suits and demands of all entities or persons. The Insurer shall not be bound by or be deemed to have notice of the provisions of this Amended and Restated Life Insurance Agreement.

2.5Transfer of Policy Upon Change in Control.  Upon a Change in Control, the Corporation shall fully pay all premiums, including all future premiums not yet payable, on the Policy and transfer the Policy to the Excutive.

ARTICLE 3
Miscellaneous

3.1Binding Obligation of Corporation and Any Successor in Interest.  Corporation expressly agrees that it shall not merge or consolidate into or with another corporation or sell substantially all of its assets to another corporation, firm or person until such corporation, firm or person expressly agrees, in writing, to assume and discharge the duties and obligations of the Corporation under this Amended and Restated Life Insurance Agreement. This Amended and Restated Life Insurance Agreement shall be binding upon the parties hereto, their successors, beneficiaries, heirs and personal representatives.

3.2Revocation.  It is agreed by and between the parties hereto that, during the lifetime of the Executive, this Amended and Restated Life Insurance Agreement may be amended or revoked at any time or times, in whole or in part, by the mutual written assent of the Executive and the Corporation.

3.3Termination. This Amended and Restated Life Insurance Agreement will automatically terminate upon the latest of (a) Termination of Employment, (b) death, or (c) the payment of all of the benefits as specified in Section 2.1 of this Amended and Restated Life Insurance Agreement.

3.4Gender.  Whenever in this Amended and Restated Life Insurance Agreement words are used in the masculine or neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender whenever they should so apply.

3.5Effect on Other Corporation Benefit Plans.  Nothing contained in this Amended and Restated Life Insurance Agreement shall affect the right of the Executive to participate in or be covered by any qualified or non-qualified pension, profit-sharing, group, bonus or other supplemental compensation or fringe benefit plan constituting a part of Corporation’s existing or future compensation structure.

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3.6Headings.  Headings and subheadings in this Amended and Restated Life Insurance Agreement are inserted for reference and convenience only and shall not be deemed a part of this Amended and Restated Life Insurance Agreement.

3.7Applicable Law.  The validity and interpretation of this Amended and Restated Life Insurance Agreement shall be governed by the laws of the State of Illinois.

ARTICLE 4
ERISA Provisions and Claims Procedure

4.1Claims Procedure.  Any person or entity who has not received benefits under this Amended and Restated Life Insurance Agreement that he or she believes should be paid (the “claimant”) shall make a claim for such benefits as follows:

4.1.1Initiation — Written Claim.  The claimant initiates a claim by submitting to the Corporation a written claim for benefits within 180 days of the event that triggers a claim for said benefits under this Amended and Restated Life Insurance Agreement.

4.1.2Timing of Corporation Response.  The Corporation shall respond to such claimant within 90 days after receiving the claim.  If the Corporation determines that special circumstances require additional time for processing the claim, the Corporation can extend the response period by an additional 90 days by notifying the claimant in writing, prior to the end of the initial 90-day period, that an additional period is required.  The notice of extension must set forth the special circumstances and the date by which the Corporation expects to render its decision.

4.1.3Notice of Decision.  If the Corporation denies part or all of the claim, the Corporation shall notify the claimant in writing of such denial.  The Corporation shall write the notification in a manner calculated to be understood by the claimant.  The notification shall set forth:

(a)The specific reasons for the denial,

(b)A reference to the specific provisions of the Amended and Restated Life Insurance Agreement on which the denial is based,

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

(d)An explanation of the Amended and Restated Life Insurance Agreement’s review procedures and the time limits applicable to such procedures, and

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

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4.2Review Procedure.  If the Corporation denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Corporation of the denial, as follows:

4.2.1Initiation — Written Request.  To initiate the review, the claimant, within 60 days after receiving the Corporation’s notice of denial, must file with the Corporation a written request for review.

4.2.2Additional Submissions — Information Access.  The claimant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim.  The Corporation shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits.

4.2.3Considerations on Review.  In considering the review, the Corporation shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

4.2.4Timing of Corporation Response.  The Corporation shall respond in writing to such claimant within 60 days after receiving the request for review.  If the Corporation determines that special circumstances require additional time for processing the claim, the Corporation can extend the response period by an additional 60 days by notifying the claimant in writing, prior to the end of the initial 60-day period, that an additional period is required.  The notice of extension must set forth the special circumstances and the date by which the Corporation expects to render its decision.

4.2.5Notice of Decision.  The Corporation shall notify the claimant in writing of its decision on review.  The Corporation shall write the notification in a manner calculated to be understood by the claimant.  The notification shall set forth:

(a)The specific reasons for the denial,

(b)A reference to the specific provisions of the Amended and Restated Life Insurance Agreement on which the denial is based,

(c)A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits, and

(d)A statement of the claimant’s right to bring a civil action under ERISA Section 502(a).

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4.3Arbitration.  If the claimant has a claim not related to Disability, and if the claimant continues to dispute any non-Disability benefit following the Review Procedure, the claimant shall then have the option to submit the dispute to arbitration.  Such arbitration shall be conducted by a single arbitrator sitting in a location selected by the claimant that is within 50 miles of the main office of the Corporation, in accordance with the rules of the American Arbitration Association (the “AAA”) then in effect.  The arbitrator shall be selected by the parties from a list of arbitrators provided by the AAA, provided that no arbitrator shall be related to or affiliated with either of the parties.  No later than 10 days after the list of proposed arbitrators is received by the parties, the parties or their respective representatives shall meet at a mutually convenient location or via telephone.  At that meeting, the party who sought arbitration shall eliminate one proposed arbitrator and then the other party shall eliminate one proposed arbitrator.  The parties shall continue to eliminate names from the list of proposed arbitrators in this manner until a single proposed arbitrator remains.  This remaining arbitrator shall arbitrate the dispute.  Each party shall submit, in writing, the specific requested action or decision it wishes to take or make with respect to the matter in dispute, and the arbitrator shall be obliged to choose on party’s specific requested action or decision, without being permitted to effectuate any compromise position.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction; provided, however, that the claimant shall be entitled to seek specific performance of his or her right to be paid through the date of termination during the pendency of any dispute or controversy arising under or in connection with this Amended and Restated Life Insurance Agreement.

4.4Administration.  The Corporation shall have powers which are necessary to administer this Amended and Restated Life Insurance Agreement, including but not limited to:

(a)Interpreting the provisions of this Amended and Restated Life Insurance Agreement;

(b)Establishing and revising the method of accounting for this Amended and Restated Life Insurance Agreement;

(c)Maintaining a record of benefit payments; and

(d)Establishing rules and prescribing any forms necessary or desirable to administer this Amended and Restated Life Insurance Agreement.

4.5Named Fiduciary.  The Corporation shall be the named fiduciary and plan administrator under the Amended and Restated Life Insurance Agreement.  The named fiduciary may delegate to others certain aspects of the management and operation responsibilities of the plan including the employment of advisors and the delegation of ministerial duties to qualified individuals.

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IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully read this Amended and Restated Life Insurance Agreement and executed the original thereof on                                    ,                    and that, upon execution, each has received a confirming copy.

(WITNESS)	[Executive Name]
	WEST SUBURBAN BANCORP, INC.
	By:
(WITNESS)	Its:

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EX-13

Exhibit 13

Profile

West Suburban Bancorp, Inc. (“West Suburban”) is the parent bank holding company of West Suburban Bank, Lombard, Illinois (the “Bank” and, together with West Suburban, the “Company”). The Company had total assets at December 31, 2008 of approximately $1.9 billion. The Bank is one of the largest independent banks headquartered in DuPage County.

West Suburban Bancorp, Inc.

Financial Highlights

	Years Ended December 31,
	(Dollars in thousands, except per share data)
	2008		2007		2006		2005		2004
Net income	$	16,816	$	23,413	$	25,351	$	25,486	$	23,658
Per share data
Earnings	38.88		54.13		58.62		58.93		54.82
Book value (GAAP)	264.12		241.76		220.43		218.87		223.60
Book value (non-GAAP) (1)	372.03		373.34		359.18		344.60		347.87
Net loans	1,233,595		1,226,571		1,153,885		1,091,747		1,046,125
Total assets	1,867,420		1,851,357		1,876,643		1,827,191		1,748,049
Total deposits	1,591,565		1,637,714		1,677,844		1,639,666		1,569,742

(1)Book value per share (non-GAAP) represents the aggregate amount of shareholders’ equity and common stock in ESOP subject to contingent repurchase obligation divided by the number of outstanding shares. See Note 7 to the Company’s consolidated financial statements and “Non-GAAP Financial Measures.” This presentation is consistent with the Company’s belief that it is unlikely that the Company would be required to satisfy the contingent repurchase obligation.

Table of Contents

Profile	1
Special Note Concerning Forward-Looking Statements and Risk Factors	2
Letter to Our Shareholders, Customers and Friends	3
Common Stock, Book Value and Dividends	4
Business Review	4
Management’s Report on Internal Control Over Financial Reporting	5
Report of Independent Registered Public Accounting Firm	6
Consolidated Financial Statements	7
Notes to Consolidated Financial Statements	11
Stock Performance Presentation	34
Selected Financial Data	36
Non-GAAP Financial Measures	37
Average Balance Sheets, Net Interest Income and Average Rates and Yields on a Tax Equivalent Basis	38
Management’s Discussion and Analysis of Financial Condition and Results of Operations	39
Boards of Directors and Officers	50
Addresses of West Suburban Facilities	53
Map of Facilities	55
Shareholder Information	57

1

Special Note Concerning Forward-Looking Statements and Risk Factors

This document (including information incorporated by reference) contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of U.S. and global economies and financial markets in general and the strength of the local economies in which the Company conducts its operations, including the local residential and commercial real estate markets, which may be less favorable than expected and may result in, among other things, a deterioration in the credit quality and value of the Company’s assets; (ii) the effects of, and changes in, federal, state and local laws, regulations and policies affecting banking, securities, taxation, insurance and monetary and financial matters, as well as any laws and regulations otherwise affecting the Company, including laws and regulations intended to address the current stresses in the U.S. and global financial markets, national security and money laundering; (iii) the effects of continued adverse market conditions and further volatility in investment securities generally, which may result in a deterioration in the value of the securities in the Company’s investment portfolio; (iv) the ability of the Company to comply with applicable federal, state and local laws, regulations and policies and the consequences that may result from any such inability to comply; (v) the effects of changes in interest rates (including the effects of changes in the rate of prepayments of the Company’s assets) and the policies of the Board of Governors of the Federal Reserve System; (vi) the ability of the Company to compete with other financial institutions as effectively as the Company currently intends due to increases in competitive pressures in the financial services sector; (vii) the ability of the Company to maintain an acceptable net interest margin; (viii) the ability of the Company to obtain new customers and retain existing customers; (ix) the timely development and acceptance of products and services, including products and services offered through alternative delivery channels such as the Internet; (x) technological changes implemented by the Company and by other parties, including third party vendors, which may be more difficult or more expensive than anticipated or which may have unforeseen consequences to the Company and its customers, including technological changes implemented for, or related to, the Company’s website or new products such as prepaid solutions cards, payroll cards and other similar products and services; (xi) the ability of the Company, and certain of its vendors, to develop and maintain secure and reliable electronic systems, including systems developed for the Company’s website or new products such as prepaid solutions cards, payroll cards and other similar products and services; (xii) the ability of the Company to retain key executives and employees, and the difficulty that the Company may experience in replacing key executives and employees in an effective manner; (xiii) consumer spending and saving habits which may change in a manner that affects the Company’s business adversely; (xiv) the economic impact of past and any future terrorist attacks, acts of war or threats thereof and the response of the U.S. to any such attacks and threats; (xv) business combinations and the integration of acquired businesses, which may be more difficult or expensive than expected; (xvi) the costs, effects and outcomes of existing or future litigation and disputes with third parties; (xvii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies and the Financial Accounting Standards Board, the Public Company Accounting Oversight Board and the Securities and Exchange Commission; (xviii) credit risks and the risks from concentrations (by geographic area or industry) within the Company’s loan portfolio; (xix) the failure of the Company’s Real Estate Investment Trust (“REIT”) to qualify as a REIT and the effects of such failure on the Company’s consolidated effective tax rate; and (xx) the ability of the Company to manage the risks associated with the foregoing as well as anticipated.

Additional information concerning the Company and its business, including risk factors that could materially affect the Company’s results of operations and financial condition, is included in the Company’s filings with the Securities and Exchange Commission, including the Company’s most recent Annual Report on Form 10-K.

2

To Our Shareholders, Customers and Friends

We think that most of you will agree that 2008 was one of the most challenging years since the years of The Great Depression. The financial markets were in turmoil worldwide for most of the year and there is clear consensus that the U.S. entered into a recession. Many of this country’s premier large financial services organizations experienced extreme stress which, in some cases, could not be overcome. Bear Stearns, Lehman Brothers, Countrywide Financial, Washington Mutual, National City and Wachovia are just a few of the organizations that were not able to successfully overcome the challenges they faced during 2008.

While 2008 was not a banner year for West Suburban, we were able to outperform most of our peers (U.S. banks between $1 and $3 billion in assets) according to Uniform Bank Performance data as of, and for the year ended, December 31, 2008. Our net income for 2008 represented a .90% return on average assets in comparison to a return of .35% for our peers. Our non-current loans as a percentage of gross loans was 2.02% compared to 2.50% for our peers as of December 31, 2008.

Although we compared well to our peers, our net income decreased by 28.2% in 2008 to $16.8 million. The decrease resulted primarily from a $10 million increase in our provision for loan losses as we increased our allowance for loan losses to total loans to 1.25%. Building our allowance for loan losses was appropriate in light of the state of the local and national economy and the increases in our problem and nonaccrual loans. Even as we built our reserves, our performance permitted us to pay our quarterly dividend of $10 per share for total 2008 dividends of $40 per share. As we look forward to better times, we remain focused on providing our customers superior service and an extensive menu of loan and deposit products.

At the end of 2008 we closed our travel department after 30 years of providing travel and vacation packages throughout the U.S. and to countries around the world. During January of 2009, Dennis Woodyatt, the manager of Travel with West Suburban, passed away. Dennis will be missed by West Suburban and our many regular patrons of the travel department.

As in the past, we continue to provide our customers traditional banking products such as checking, savings and certificate of deposit accounts as well as competitive home equity, residential real estate and commercial loans. We will continue to enhance our online banking services at www.westsuburbanbank.com in order to offer our customers improved accessibility 24 hours a day, seven days a week. Our new consumer banking initiatives will not distract us from our commitment to our business customers. We value these relationships and appreciate that our future success depends upon our ability to continue to be a good partner to business throughout the communities we serve.

We would like to express our appreciation to everyone for the support that has allowed us to become and remain one of the largest independent banks headquartered in DuPage County and we welcome your comments, criticisms and suggestions. We could not have achieved our success without the support of our shareholders, customers, communities, friends and employees.

Sincerely,
Kevin J. Acker	Duane G. Debs
Chairman of the Board	President and Chief Financial Officer

3

Common Stock, Book Value and Dividends

West Suburban has a single class of common stock issued and outstanding. The common stock is not traded on any stock exchange or on the over-the-counter market. West Suburban’s per share book value as of the end of each quarter and dividends declared for the last two years are set forth below:

Year	Quarter	BookValue GAAP		BookValue Non-GAAP (1)		Dividends Declared
2008	4th	$	264.12	$	372.03	$	10.00
	3rd	263.04		376.34		10.00
	2nd	249.64		374.87		10.00
	1st	242.62		382.15		10.00
2007	4th	$	241.76	$	373.34	$	20.00
	3rd	235.85		377.08		10.00
	2nd	227.25		366.85		10.00
	1st	226.33		366.47		10.00

(1)Book value per share (non-GAAP) represents the aggregate amount of shareholders’ equity and common stock in ESOP subject to contingent repurchase obligation divided by the number of outstanding shares. See Note 7 to the Company’s consolidated financial statements and “Non-GAAP Financial Measures.” This presentation is consistent with the Company’s belief that it is unlikely that the Company would be required to satisfy the contingent repurchase obligation.

The dividends declared during the fourth quarter of 2007 included a special $10.00 per share dividend payable on December 15, 2007 to shareholders of record as of December 1, 2007. The Company did not pay a special dividend during the fourth quarter of 2008.

Business Review

As of December 31, 2008, the Company had total assets of approximately $1.9 billion and maintained 34 full-service branches, five limited-service branches and five departments providing insurance, financial and other services for the convenience of the customers of the Bank throughout DuPage, Kane, Kendall and Will Counties in Illinois. The Bank focuses on providing retail and commercial banking products and services in its market area. The Company had 533 full-time equivalent employees at December 31, 2008.

4

MANAGEMENT’S REPORT ON INTERNAL CONTROL
OVER FINANCIAL REPORTING

Management of the Company is responsible for establishing and maintaining an effective system of internal control over financial reporting. The Company’s system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. There are inherent limitations in the effectiveness of any system of internal control over financial reporting, including the possibility of human error and the circumvention or overriding of controls. Accordingly, even an effective system of internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. Projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the Company’s systems of internal control over financial reporting as of December 31, 2008. This assessment was based on criteria for effective internal control over financial reporting described in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management believes that, as of December 31, 2008, the Company maintained effective internal control over financial reporting based on those criteria.

The Company’s independent auditors have issued an audit report on the effectiveness of the Company’s internal control over financial reporting.

March 9, 2009

Kevin J. Acker

Chairman and Chief Executive Officer

Duane G. Debs

President and Chief Financial Officer

5

Report of Independent Registered Public Accounting Firm

Board of Directors and Shareholders

West Suburban Bancorp, Inc.

Lombard, Illinois

We have audited the accompanying consolidated balance sheets of West Suburban Bancorp, Inc.  (the “Company”) as of December 31, 2008 and 2007, and the related consolidated statements of income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2008. We also have audited the Company’s internal control over financial reporting as of December 31, 2008, based on the criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Controls Over Financial Reporting. Our responsibility is to express an opinion on these financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2008 and 2007, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2008 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on the criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

	/s/ Crowe Horwath LLP
Oakbrook, Illinois
March 9, 2009

6

WEST SUBURBAN BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2008 AND 2007

(Dollars in thousands)

	2008			2007
Assets
Cash and due from banks	$	33,174		$	32,183
Federal funds sold	22,300			1,000
Total cash and cash equivalents	55,474			33,183
Securities
Available for sale (amortized cost of $227,333 in 2008 and $461,100 in 2007)	225,814			459,405
Held to maturity (fair value of $244,928 in 2008 and $23,953 in 2007)	240,234			24,076
Federal Home Loan Bank stock	6,144			5,258
Total securities	472,192			488,739
Loans, less allowance for loan losses of $15,578 in 2008 and $9,269 in 2007	1,233,595			1,226,571
Bank-owned life insurance	35,442			37,283
Premises and equipment, net	45,298			43,097
Other real estate	4,658			824
Accrued interest and other assets	20,761			21,660
Total assets	$	1,867,420		$	1,851,357
Liabilities and shareholders’ equity
Deposits
Demand-noninterest-bearing	$	132,664		$	141,724
Interest-bearing	1,458,901			1,495,990
Total deposits	1,591,565			1,637,714
Federal funds purchased	55,000			—
Prepaid solutions cards	37,964			24,649
Accrued interest and other liabilities	21,992			27,526
Common stock in ESOP subject to contingent repurchase obligation	46,670			56,907
Shareholders’ equity
Common stock, no par value; 15,000,000 shares authorized; 432,495 shares issued and outstanding	3,457			3,457
Surplus	38,066			38,066
Retained earnings	120,676			121,360
Accumulated other comprehensive loss	(1,300		)	(1,415		)
Amount reclassified on ESOP shares	(46,670		)	(56,907		)
Total shareholders’ equity	114,229			104,561
Total liabilities and shareholders’ equity	$	1,867,420		$	1,851,357

See accompanying notes to consolidated financial statements.

7

WEST SUBURBAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(Dollars in thousands, except per share data)

	2008			2007			2006
Interest income
Loans, including fees	$	72,577		$	85,088		$	82,542
Securities
Taxable	21,109			19,192			19,222
Exempt from federal income tax	1,176			1,121			1,040
Federal funds sold	198			3,061			2,932
Total interest income	95,060			108,462			105,736
Interest expense
Deposits	33,308			48,203			45,303
Other	664			3			31
Total interest expense	33,972			48,206			45,334
Net interest income	61,088			60,256			60,402
Provision for loan losses	10,360			375			150
Net interest income after provision for loan losses	50,728			59,881			60,252
Noninterest income
Prepaid solutions cards	16,206			13,380			8,295
Service fees on deposit accounts	6,357			6,435			6,978
Debit card fees	2,150			2,081			1,970
Bank-owned life insurance	(2,179		)	1,525			1,462
Net gain on sales of loans held for sale	70			50			124
Net realized gains (losses) on securities transactions	101			(6		)	85
Impairment of FHLMC preferred stock	—			(381		)	—
Gain on redemption and interest in escrow fund of VISA stock	2,075			—			—
Other	3,890			3,980			3,951
Total noninterest income	28,670			27,064			22,865
Noninterest expense
Salaries and employee benefits	22,162			24,422			24,238
Prepaid solutions cards	12,037			9,645			5,767
Furniture and equipment	6,340			5,570			4,759
Occupancy	5,224			4,509			4,581
Advertising and promotion	2,126			2,324			1,916
Professional fees	2,263			1,673			1,217
Other	7,631			6,891			5,378
Total noninterest expense	57,783			55,034			47,856
Income before income taxes	21,615			31,911			35,261
Income tax expense	4,799			8,498			9,910
Net income	$	16,816		$	23,413		$	25,351
Earnings per share	$	38.88		$	54.13		$	58.62
Average shares outstanding	432,495			432,495			432,495

See accompanying notes to consolidated financial statements.

8

WEST SUBURBAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(Dollars in thousands, except per share data)

	Common Stock and Surplus		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Amount Reclassified on ESOP Shares			Total Shareholders’ Equity
Balance, January 1, 2006	$	41,523	$	115,846		$	(8,331	)	$	(54,378	)	$	94,660
Comprehensive income
Net income			25,351									25,351
Change in unrealized loss on available for sale securities, net of reclassification and tax effects						2,878						2,878
Total comprehensive income												28,229
Adjustment to initially apply SFAS No. 158, net of tax						(298		)				(298		)
Cash dividends declared - $50.00 per share			(21,625		)							(21,625		)
Reclassification due to change in fair value of common stock in ESOP subject to contingent repurchase obligation									(5,631		)	(5,631		)
Balance, December 31, 2006	41,523		119,572			(5,751		)	(60,009		)	95,335
Comprehensive income
Net income			23,413									23,413
Change in unrealized loss on available for sale securities, net of reclassification and tax effects						4,432						4,432
Change in post-retirement obligations, net of reclassificaton and tax effects						(96		)				(96		)
Total comprehensive income												27,749
Cash dividends declared - $50.00 per share			(21,625		)							(21,625		)
Reclassification due to change in fair value of common stock in ESOP subject to contingent repurchase obligation									3,102			3,102
Balance, December 31, 2007	41,523		121,360			(1,415		)	(56,907		)	104,561
Cummulative adjustment to apply EITF 06-04			(200		)							(200		)
Comprehensive income
Net income			16,816									16,816
Change in unrealized loss on available for sale securities, net of reclassification and tax effects						106						106
Change in post-retirement obligations, net of reclassificaton and tax effects						9						9
Total comprehensive income												16,931
Cash dividends declared - $40.00 per share			(17,300		)							(17,300		)
Reclassification due to change in fair value of common stock in ESOP subject to contingent repurchase obligation									10,237			10,237
Balance, December 31, 2008	$	41,523	$	120,676		$	(1,300	)	$	(46,670	)	$	114,229

See accompanying notes to consolidated financial statements.

9

WEST SUBURBAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(Dollars in thousands)

	2008			2007			2006
Cash flows from operating activities
Net income	$	16,816		$	23,413		$	25,351
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation	3,644			3,299			3,607
Provision for loan losses	10,360			375			150
Deferred income tax benefit	(1,861		)	(1,269		)	(1,701		)
Net discount accretion and premium amortization of securities	(148		)	291			564
Net realized (gain) loss on securities transactions	(101		)	6			(85		)
Impairment of FHLMC preferred stock	—			381			—
Gain on redemption of and interest in escrow fund of VISA stock	(2,075		)	—			—
Decrease (increase) in carrying value of bank-owned life insurance	2,179			(1,525		)	(1,462		)
Amortization of deferred loan fees	7			57			100
Net gain on sales of loans held for sale	(70		)	(50		)	(124		)
Sales of loans held for sale	5,480			5,875			9,730
Origination of loans held for sale	(6,828		)	(6,175		)	(9,466		)
Net gain on sales of premises and equipment	(5		)	(2		)	(7		)
Net loss (gain) on sales of other real estate	(29		)	2			(99		)
Write down of fair value of other real estate	121			—			—
Decrease (increase) in accrued interest and other assets	3,659			(2,461		)	(117		)
(Decrease) increase in accrued interest and other liabilities	(5,720		)	5,017			3,275
Net cash provided by operating activities	25,429			27,234			29,716
Cash flows from investing activities
Securities available for sale
Sales	89,838			470			—
Maturities, calls and redemptions	167,248			89,870			104,130
Purchases	(22,241		)	(90,088		)	(87,250		)
Securities held to maturity and restricted securities
Maturities, calls and redemptions	23,603			21,054			23,379
Purchases	(240,376		)	(167		)	(2,800		)
Net increase in loans	(20,418		)	(73,782		)	(63,252		)
Investment in bank-owned life insurance policies	(337		)	(1,336		)	(735		)
Purchases of premises and equipment	(5,994		)	(6,521		)	(3,435		)
Sales of premises and equipment	154			92			49
Sales of other real estate	519			539			682
Net cash used in investing activities	(8,004		)	(59,869		)	(29,232		)
Cash flows from financing activities
Net (decrease) increase in deposits	(46,149		)	(40,130		)	38,178
Net increase in federal funds purchased	55,000			—			—
Net increase in prepaid solutions cards	13,315			3,544			1,198
Dividends paid	(17,300		)	(21,625		)	(21,625		)
Net cash provided by (used in) financing activities	4,866			(58,211		)	17,751
Net increase (decrease) in cash and cash equivalents	22,291			(90,846		)	18,235
Beginning cash and cash equivalents	33,183			124,029			105,794
Ending cash and cash equivalents	$	55,474		$	33,183		$	124,029
Supplemental disclosures
Cash paid for
Interest	35,031			48,816			43,976
Income taxes	7,824			9,082			11,270
Other real estate acquired through loan foreclosures	4,445			1,014			724

See accompanying notes to consolidated financial statements.

10

WEST SUBURBAN BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except per share data)

Note 1 - Nature of Business and Summary of Significant Accounting Policies

West Suburban Bancorp, Inc. (“West Suburban”) through the branch network of its subsidiary, West Suburban Bank (the “Bank” and, together with West Suburban, the “Company”), operates 34 full-service branches, five limited-service branches and five departments providing insurance, financial and other services for the convenience of the customers of the Bank throughout DuPage, Kane, Kendall and Will Counties in Illinois. Customers in these areas are the primary consumers of the Company’s loan and deposit products and services. Although borrower cash flow is expected to be the primary source of repayment, the Company’s loans are generally secured by various forms of collateral or security including real estate, business assets, consumer goods, personal guarantees and other items.

Operating Segments

While the Company’s senior management monitors the revenue streams derived from various individual and groups of products and services, operations are managed and financial performance is evaluated on a Company-wide basis. Accordingly, all of the Company’s operations are considered by management to be aggregated in one reportable operating segment. Discrete financial information is not available other than on a Company-wide basis.

Principles of Consolidation

The consolidated financial statements include the accounts of West Suburban and the Bank. Significant intercompany accounts and transactions have been eliminated.

Use of Estimates

To prepare financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions, which are subject to change, based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and future results could differ. The allowance for loan losses, fair values of financial instruments and other than temporary impairment of securities are particularly subject to change.

Securities

Debt and marketable equity securities are classified into two categories, “available for sale” and “held to maturity.” Available for sale securities are carried at fair value with net unrealized gains and losses (net of deferred tax) reported in accumulated other comprehensive loss as a separate component of shareholders’ equity. Held to maturity securities are carried at amortized cost as the Company has both the ability and positive intent to hold them to maturity. Other securities such as Federal Home Loan Bank stock are carried at cost. Interest income includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage backed securities where prepayments are anticipated. Gains and losses on sales are recorded on the trade date and determined using the specific identification method. The Company does not engage in trading activities.

Declines in the fair value of securities below their cost that are other than temporary are reflected as realized losses. In estimating other-than-temporary losses, management considers: (1) the length of time and extent that fair value has been less than cost; (2) the financial condition and near term prospects of the issuer; and (3) the Company’s ability and intent to hold the security for a period sufficient to allow for any anticipated recovery in fair value.

Loans and Allowance for Loan Losses

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at the principal balance outstanding, net of unearned interest, deferred loan fees and costs and an allowance for loan losses. Interest income is accrued on the unpaid balance of the Company’s loans and includes amortization of net deferred loan fees and costs over the loan term. Loan origination fees, net of certain direct origination costs, are deferred and recognized in interest income using the level-yield method without anticipating prepayments. Accrual of interest is generally discontinued on loans 90 days past due, or on an earlier date, if management believes, after considering economic and business conditions and collection efforts, that the borrower’s financial

11

condition is such that collection of principal or interest is doubtful. In some circumstances, a loan more than 90 days past due may continue to accrue interest if it is fully secured and in the process of collection. When a loan is classified as nonaccrual, interest previously accrued but not collected is charged back to interest income. When payments are received on nonaccrual loans they are first applied to principal, then to interest income and finally to expenses incurred for collection.

The allowance for loan losses is a valuation allowance for probable incurred credit losses in the loan portfolio. The allowance is increased by a provision for loan losses charged to earnings. Loan losses are charged against the allowance when management believes the uncollectibility of a loan has been established. Subsequent recoveries, if any, are credited to the allowance. The allowance consists of specific and general components. The specific component relates to specific loans that are individually classified as impaired. The general component covers pools of other loans and is based on historical loss experience adjusted for current factors. The allowance for loan losses is evaluated monthly based on management’s periodic review of loan collectibility in light of historical loan loss experience, the nature and volume of the loan portfolio, information about specific borrower situations and estimated collateral values and prevailing economic conditions. Although allocations of the allowance may be made for specific loans, the entire allowance is available for any loan that, in management’s judgment, should be charged-off. Management’s evaluation of loan collectibility is inherently subjective as it requires estimates that are subject to significant revision as more information becomes available or as relevant circumstances change.

The Company evaluates commercial, real estate construction and commercial mortgage loans monthly for impairment. A loan is considered impaired when, based on current information and events, full payment under the loan terms is not expected. Impairment is measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the loan’s collateral, if repayment of the loan is collateral dependent. A valuation allowance is maintained for the amount of impairment. Generally, loans 90 days or more past due and all loans classified as nonaccrual status are considered for impairment. Impairment is considered on an entire category basis for smaller-balance loans of similar nature such as residential real estate and consumer loans, and on an individual basis for other loans. In general, consumer and credit card loans are charged-off no later than 120 days after a consumer or credit card loan becomes past due.

Loans Held for Sale

Loans are identified as either held for investment or held for sale upon origination. Loans held for sale are recorded at the lower of amortized cost or fair value, as determined by outside commitments from investors. Unrealized losses, if any, are recognized on a current basis by charges to earnings. At December 31, 2008 and 2007, loans held for sale were $1,768 and $350, respectively. The cost and fair value of loans held for sale was approximately the same. Mortgage loans held for sale are generally sold with servicing released.

Bank-Owned Life Insurance (“BOLI”)

The Company has purchased life insurance policies on certain officers and directors. In accordance with Emerging Issues Task Force (the “EITF”) 06-5, Bank-owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement.

Premises and Equipment

Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Depreciation is generally computed on the straight-line method over the estimated useful lives of the assets ranging from 8 to 50 years for premises and from 3 to 15 years for furniture and equipment.

Other Real Estate

Other real estate includes properties acquired in partial or total settlement of problem loans. Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. If fair value declines subsequent to foreclosure, a valuation allowance is recorded through expense. Operating costs after acquisition are expensed.

12

Long-term Assets

Premises and equipment and other long-term assets are reviewed for impairment when events indicate their carrying amount may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value.

Loan Commitments and Related Financial Instruments

Financial instruments include off-balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded.

Prepaid Solutions Cards

Prepaid solutions cards revenues are recognized when services are performed. These revenues are comprised primarily of service and transaction fees. Service fees represent payments associated with card preparation, customization, usage, non-usage and processing. Transaction fees primarily represent interchange fees generated as transactions are made by cardholders. These fees are recognized as revenue in the same period the related transactions occur or services are rendered. Income generated from the investment of prepaid solutions card balances is not allocated to the prepaid solutions group and therefore is not included in the prepaid solutions cards income category.

Prepaid solutions cards expenses are recognized as incurred. These expenses generally include costs associated with the card preparation and customization, data processing fees associated with the card transaction processing, and other activity expenses directly associated with the Bank’s prepaid solutions cards customers. The prepaid solutions division utilizes various departments within the Bank in its day to day operations. The costs incurred by these departments are not allocated to the prepaid solutions group and therefore are not included in the prepaid solutions cards expense category. General and administrative expenses incurred by the prepaid solutions division, such as salaries and benefits, furniture and equipment, advertising and promotion, and professional fees are included in the corresponding expense line classification in the Company’s consolidated statements of income.

Income Taxes

Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities, computed using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

The Company adopted Financial Accounting Standards Board (“FASB”) Interpretation 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”), as of January 1, 2007. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. The adoption had no impact on the Company’s financial condition or results of operations.

The Company recognizes interest and/or penalties related to income tax matters in income tax expense.

Employee Stock Ownership Plan (“ESOP”) and Other Retirement Plans

In July 2007, the Company established the West Suburban Bank 401(k) Profit Sharing Plan. This plan was established to assist the Company in recruiting and retaining its personnel. Participation in the plan is subject to certain age and service requirements. Although the Company currently intends to match a percentage of the contributions that each employee voluntarily makes to the plan, all contributions by the Company are discretionary and subject to review by the Board of Directors from time to time. The plan is also intended to enable long time employees of the Company that also participate in the ESOP to diversify their retirement savings.

The Bank also maintains an ESOP, which is a noncontributory tax qualified retirement plan that covers employees who have satisfied specific service requirements. Subject to review by the Board of Directors, the Bank makes contributions to the ESOP for the benefit of the participants from time to time. Dividends declared on common stock owned by the ESOP are charged against retained earnings.

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Dividends paid on ESOP shares are passed through to participants. Earned and allocated ESOP shares are voted by the respective participants. Because participants may require the Company to purchase their ESOP shares upon termination of their employment, the appraised fair value of all earned and allocated ESOP shares is reclassified from shareholders’ equity.

The Company has a postretirement heathcare plan covering certain executives. Postretirement benefit costs are net of service and interest costs and amortization of gains and losses not immediately recognized.

The Company has deferred compensation arrangements with certain former and current executive officers. Deferred compensation expense allocates the benefits over years of service.

Earnings Per Share

Earnings per share is calculated on the basis of the daily weighted average number of shares outstanding. ESOP shares are considered outstanding for this calculation.

Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks and federal funds sold. Generally, federal funds are sold for one-day periods. Net cash flows are reported for customer loan, deposit, federal funds purchased and prepaid solutions cards transactions.

Comprehensive Income

Comprehensive income includes net income and other comprehensive income. The Company’s other comprehensive income consists of the change in unrealized gains and losses on available for sale securities and change in postretirement obligations, net of reclassification adjustments and deferred tax effects.

Legal Proceedings

Legal proceedings, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated.

Restrictions on Cash

Cash on hand or on deposit with the Federal Reserve Bank of $12,982 and $13,055 was required to meet regulatory reserve and clearing requirements at year end 2008 and 2007, respectively.

Dividend Restriction

Banking regulations require maintaining certain capital levels and may limit the dividends paid by the Bank to West Suburban or by West Suburban to shareholders. (See Note 11 in the Consolidated Financial Statements for more specific disclosure.)

Fair Value of Financial Instruments

Fair value of financial instruments are estimated using relevant market information and other assumptions. (See Note 9 for more specific disclosure.) Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates.

Reclassifications

Certain reclassifications have been made in prior years’ financial statements to conform to the current year’s presentation.

Adoption of New Accounting Standards

In September 2006, the FASB issued Statement of Financial Accounting Standards (“SFAS”) 157, “Fair Value Measurements.” SFAS 157 defines fair value, establishes a framework for measuring fair value and expands required disclosures about fair value measurements. SFAS 157 establishes a fair value hierarchy about the assumptions used to measure fair value and clarifies assumptions about risk and the effect of a restriction on the sale or use of an asset. The standard is effective for fiscal years beginning after November 15, 2007. In February 2008, the FASB issued Staff Position (“FSP”) SFAS 157-2, “Effective Date of SFAS 157.” This FSP delays the effective date of SFAS 157 for all nonfinancial assets and nonfinancial liabilities (except those that are recognized or

14

disclosed at fair value on a recurring basis (at least annually)) to fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. The impact of the adoption was not material to the Company’s financial condition or results of operations. In October 2008, the FASB issued FSP 157-3, “Determining the Fair Value of a Financial Asset when the Market for That Asset is Not Active.” FSP 157-3 clarifies the application of SFAS 157 in a market that is not active. Please refer to Note 9 for disclosures relating to and resulting from the adoption of SFAS 157.

In February 2007, the FASB issued SFAS 159, “The Fair Value Option for Financial Assets and Financial Liabilities.” SFAS 159 provides companies with an option to report selected financial assets and liabilities at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. SFAS 159 was effective for the Company on January 1, 2008. The Company did not elect the fair value option for any financial assets or financial liabilities upon adoption on January 1, 2008.

In September 2006, the EITF finalized Issue 06-4, “Accounting for Deferred Compensation and Postretirement Benefit Aspects of Endorsement Split-Dollar Life Insurance Arrangements.” This guidance requires that a liability be recorded during the service period when a split-dollar life insurance agreement continues after a participants’ employment or retirement. The required accrued liability will be based on either the postretirement benefit cost for the continuing life insurance or based on the future death benefit depending on the contractual terms of the underlying agreement. Upon adoption, the Company recorded a cumulative effect adjustment to reduce beginning retained earnings as of January 1, 2008 by $200.

Effective December 31, 2008, the Company adopted EITF 99-20-1, “Amendment to the Impairment and Interest Income Guidance of EITF Issue No. 99-20.” The EITF strives to resolve the lack of consistency in the impairment guidance of EITF 99-20, “Recognition of Interest Income and Impairment on Purchased Beneficial Interests and Beneficial Interests That Continue to Be Held by a Transferor in Securitized Financial Assets” and SFAS 115, “Accounting for Certain Investments in Debt and Equity Securities,” for determining whether an other-than-temporary impairment has occurred. Prior to the amendment, EITF 99-20 required the use of market participant assumptions regarding future cash flows without consideration of the probability that all cash flows will be collected. However, SFAS 115 does not require exclusive reliance on market participant assumptions regarding future cash flows, permitting management to use reasonable judgment in determining the probability that a holder will be unable to collect all amounts due. The EITF removes the “market participant” concept from EITF 99-20. The impairment guidance provided by EITF 99-20-1 did not have a significant impact on the Company’s financial condition or results of operations upon adoption.

Effective December 31, 2008, the Company adopted FSP No. FAS 140-4 and FIN 46R-8, “Disclosures by Public Entities (Enterprises) about Transfers of Financial Assets and Interests in Variable Interest Entities.” This FSP was issued in advance of the finalization of other proposed amendments to SFAS 140 and Interpretation No. 46R and requires additional disclosures about transfers of financial assets and about an entity’s involvement with variable interest entities. The FSP is effective for interim and annual reporting periods ending after December 15, 2008. Adoption of this FSP affects disclosures only and therefore has no impact on the Company’s financial condition or results of operations.

Effect of Newly Issued but not Effective Accounting Pronouncements

In December 2007, the FASB issued SFAS 141R, “Business Combinations.” SFAS 141R replaces the current standard on business combinations and will significantly change the accounting for and reporting of business combinations in consolidated financial statements. This statement requires an entity to measure the business acquired at fair value and to recognize goodwill attributable to any noncontrolling interests (previously referred to as minority interests) rather than just the portion attributable to the acquirer. The statement will also result in fewer exceptions to the principle of measuring assets acquired and liabilities assumed in a business combination at fair value. In addition, the statement will result in payments to third parties for consulting, legal, and similar services associated with an acquisition to be recognized as expenses when incurred rather than capitalized as part of the business combination. SFAS 141R is effective for fiscal years beginning on or after December 15, 2008. The Company does not expect the adoption of SFAS 141R to have a material impact on the Company’s consolidated financial condition or results of operations.

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In December 2007, the FASB issued SFAS 160, “Noncontrolling Interest in Consolidated Financial Statements, an amendment of ARB No. 51”, which will change the accounting and reporting for minority interests, which will be recharacterized as noncontrolling interests and classified as a component of equity within the consolidated balance sheets. SFAS 160 is effective as of the beginning of the first fiscal year beginning on or after December 15, 2008. The adoption of SFAS 160 did not have a significant impact on the Company’s financial condition or results of operations.

In March 2008, the FASB issued SFAS 161, “Disclosures about Derivative Instruments and Hedging Activities an Amendment of FASB 133.” SFAS 161 amends SFAS 133 by requiring expanded disclosures about an entity’s derivative instruments and hedging activities, but does not change SFAS 133’s scope or accounting. This statement requires increased qualitative, quantitative, and credit-risk disclosures. SFAS 161 also amends SFAS 107 to clarify that derivative instruments are subject to SFAS 107’s concentration-of-credit-risk disclosures. SFAS 161 is effective for fiscal years beginning on or after November 15, 2008. Since SFAS 161 affects only disclosures, it will not impact the Company’s financial condition or results of operations.

In December 2008, the FASB issued FSP FAS132R-1, “Disclosures about Plan Assets.” This FSP requires additional disclosures about plan assets of a defined benefit pension or other post retirement plan. The FSP has two main objectives. First, it requires additional disclosures about major categories of plan assets and concentrations of risk within plan assets. Second, it applies the requirements of FAS 157 to defined benefit plans by requiring disclosure of the inputs and valuation techniques used to measure the fair value of plan assets and the effect of fair value measurements using unobservable inputs to changes in plan assets for the period. The requirements of the FSP are not effective until fiscal years ending after December 15, 2009, and thus will be included in the Company’s financial statements beginning with the financial statements for the year ended December 31, 2009. Adoption of this FSP affects disclosures only and therefore has no impact on the Company’s financial condition or results of operations.

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Note 2 - Securities

The amortized cost and fair value of securities available for sale are as follows at December 31:

	2008
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Corporate	$	24,430	$	—	$	(753	)	$	23,677
Trust preferred	8,511		—		(5,048		)	3,463
U.S. government sponsored entities	22,170		1,084		—			23,254
Mortgage-backed	162,062		3,385		(153		)	165,294
States and political subdivisions	10,160		57		(91		)	10,126
Total debt securities	$	227,333	$	4,526	$	(6,045	)	$	225,814

	2007
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Corporate	$	35,488	$	95	$	(764	)	$	34,819
Trust preferred	8,578		—		(809		)	7,769
U.S. government sponsored entities	195,193		134		(833		)	194,494
Mortgage-backed	207,302		1,456		(936		)	207,822
States and political subdivisions	13,918		38		(76		)	13,880
Total debt securities	460,479		1,723		(3,418		)	458,784
Preferred stock	621		—		—			621
Total	$	461,100	$	1,723	$	(3,418	)	$	459,405

The amortized cost and fair value of securities held to maturity are as follows at December 31:

	2008
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. government sponsored entities	$	28,072	$	759	$	—		$	28,831
Mortgage-backed	193,187		4,499		(26		)	197,660
States and political subdivisions	18,975		98		(636		)	18,437
Total	$	240,234	$	5,356	$	(662	)	$	244,928

	2007
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Mortgage-backed	$	11,450	$	25	$	(223	)	$	11,252
States and political subdivisions	12,626		137		(62		)	12,701
Total	$	24,076	$	162	$	(285	)	$	23,953

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Securities with unrealized losses at year end 2008 and 2007 not recognized in income are presented below by the length of time the securities have been in a continuous unrealized loss position:

	2008
	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Corporate	$	4,839	$	79	$	18,838	$	674	$	23,677	$	753
Trust Preferred	—		—		3,463		5,048		3,463		5,048
Mortgage-backed	20,607		143		3,836		36		24,443		179
States and political subdivisions	15,297		727		—		—		15,297		727
Total temporarily impaired	$	40,743	$	949	$	26,137	$	5,758	$	66,880	$	6,707

	2007
	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Corporate	$	—	$	—	$	34,728	$	764	$	34,728	$	764
Trust Preferred	7,769		809		—		—		7,769		809
U.S. government sponsored entities	—		—		165,712		833		165,712		833
Mortgage-backed	8,775		240		65,677		919		74,452		1,159
States and political subdivisions	2,903		51		10,448		87		13,351		138
Total temporarily impaired	$	19,447	$	1,100	$	276,565	$	2,603	$	296,012	$	3,703

Debt securities, with the exception of trust preferred, are evaluated for other-than-temporary impairment under FSP SFAS 115-1. The Company’s debt securities in an unrealized loss position for greater than 12 months totaled $22,674 and the related unrealized loss totaled $710 as of December 31, 2008. In accordance with FSP SFAS 115-1, unrealized losses on these debt securities are not recognized if management has the intent and ability to hold the securities until their maturity date and no concerns exist with the respect to the ability of the issuer to satisfy its obligations at maturity. Management believes that the value of these debt securities with unrealized losses will recover as the securities approach their maturity date and/or repricing date. The Company has concluded that as of December 31, 2008, these debt securities were not other-than-temporarily impaired.

The Company currently holds pooled trust preferred securities which are evaluated for other-than-temporary impairment under EITF 99-20 as amended by EITF 99-20-1. As of December 31, 2008, the unrealized loss on pooled trust preferred securities held by the Company totaled $5,048, or 59% of the amortized cost. The evaluation under EITF 99-20 includes an analysis to determine whether there has been an adverse change in the expected cash flows. The evaluation also includes monitoring the rating assigned by national rating agencies such as Moody’s Investor Service to determine if any downgrades have occurred, and a detailed review of the underlying collateral to determine a break in yield point. The Company does not expect changes in its net cash flows from these investments from the cash flows that were originally anticipated. The Company has concluded that as of December 31, 2008, the pooled trust preferred securities were not other-than-temporarily impaired.

During the year ended December 31, 2008, the Company sold the preferred stock issued by the Federal Home Loan Mortgage Corporation (the “FHLMC”) at a realized loss of $81.

For the year ended December 31, 2007, the Company recognized a $381 pre-tax charge for the other-than-temporary decline in fair value of preferred stock issued by the FHLMC. As required by SFAS 115, when a decline in fair value below cost is deemed to be other-than-temporary, the unrealized loss must be recognized as a charge to earnings. During the fourth quarter of 2007, there was a significant decline in the fair value of the preferred stock and as a result the Company concluded that the preferred stock was other-than-temporarily impaired.

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The amortized cost and fair value of debt securities available for sale and held to maturity at December 31, 2008 by contractual maturity are as follows:

	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in 1 year or less	$	14,861	$	14,747	$	2,540	$	2,541
Due after 1 year through 5 years	36,421		36,899		13,177		13,362
Due after 5 years through 10 years	1,091		1,105		21,599		22,164
Due after 10 years	12,898		7,769		9,731		9,201
Mortgage-backed	162,062		165,294		193,187		197,660
Total	$	227,333	$	225,814	$	240,234	$	244,928

Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Approximately $21,142 of securities are callable in 2009. Most of these callable securities were issued by U.S. government sponsored entities.

Securities with a carrying value of approximately $130,118 and $40,778 at December 31, 2008 and 2007, respectively, were pledged to secure public deposits, fiduciary activities and for other purposes required or permitted by law.

Sales of securities available for sale were as follows:

	2008			2007			2006
Proceeds from sales	$	89,838		$	470		$	—
Gross realized gains	135			—			—
Gross realized losses	(98		)	(30		)	—

Net gains on securities transactions in 2008, 2007 and 2006 include recoveries of $64, $24 and $85, respectively, on securities written down in 2001. The tax benefit/expense recorded on securities transactions was not material.

Note 3 - Loans

Major classifications of loans were as follows at December 31:

	2008			2007
Commercial	$	288,234		$	270,293
Consumer	4,276			5,653
Indirect automobile	4,454			8,559
Real estate
Residential	242,947			224,755
Commercial	276,995			249,836
Home equity	257,150			272,098
Construction	161,532			191,952
Held for sale	1,768			350
Credit card	10,484			11,191
Other	1,333			1,153
Total	1,249,173			1,235,840
Allowance for loan losses	(15,578		)	(9,269		)
Loans, net	$	1,233,595		$	1,226,571

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The Company makes commercial, consumer and residential real estate loans primarily to customers throughout the western suburbs of Chicago. Construction loans are primarily made to customers engaged in the development and construction of residential real estate projects within the Company’s market area. From time to time the Company will make loans outside of its market area. At December 31, 2008, loans outside the Company’s market area included loans totaling $10,579 to a customer with collateral in Arizona and loans totaling $10,000 to a second customer with collateral in Florida.

Changes in the allowance for loan losses were as follows for the years ended December 31:

	2008			2007			2006
Balance, beginning of year	$	9,269		$	10,650		$	10,681
Provision for loan losses	10,360			375			150
Loans charged-off	(4,295		)	(2,046		)	(418		)
Recoveries	244			290			237
Balance, end of year	$	15,578		$	9,269		$	10,650

Impaired loans are summarized as follows at December 31:

	2008		2007		2006
Year-end loans with no allocated allowance for loan losses	$	21,187	$	1,048	$	12
Year-end loans with allocated allowance for loan losses	9,036		2,685		9,222
Total	$	30,223	$	3,733	$	9,234

Amount of the allowance for loan losses allocated to impaired loans at year-end	$	1,684	$	421	$	4,689
Average impaired loans during the year	20,642		4,629		7,060
Interest income recognized during impairment	223		129		1,096

Nonperforming loans were as follows at December 31:

	2008		2007		2006
Loans past due 90 days or more still on accrual	$	1,705	$	480	$	319
Nonaccrual loans	23,569		2,297		1,131
Total	$	25,274	$	2,777	$	1,450

The Company generally sells mortgage loans with servicing rights released.

	2008		2007		2006
Activity during the year:
Origination of loans held for sale	$	6,828	$	6,175	$	9,466
Proceeds from sales of loans held for sale	5,480		5,875		9,730
Net gains on sales of loans held for sale	70		50		124

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Note 4 - Premises and Equipment

Major classifications of assets comprising premises and equipment are summarized as follows at December 31:

	2008			2007
Land	$	15,263		$	15,263
Premises	45,893			42,963
Furniture and equipment	50,208			47,477
Total	111,364			105,703
Less accumulated depreciation	(66,066		)	(62,606		)
Premises and equipment, net	$	45,298		$	43,097

At December 31, 2008, construction of bank premises in progress of $1,446 was included in premises in the table above. Additionally, at December 31, 2008, $129 of furniture and equipment not yet in service was included in furniture and equipment in the table above.

The Company leases certain branch properties and equipment under operating leases. Rent expense was $421, $465, and $227 for 2008, 2007 and 2006, respectively. Rent commitments before considering renewal options that generally are present, are summarized as follows:

2009	$	717
2010	592
2011	447
2012	308
2013	235
Thereafter	558
Total	$	2,857

Note 5 - Deposits

The major categories of deposits are summarized as follows at December 31:

	2008		2007
Demand-noninterest-bearing	$	132,664	$	141,724
NOW	310,178		314,741
Money market checking	322,207		292,208
Savings	320,763		337,028
Time deposits
Less than $100,000	361,313		380,094
$100,000 and greater	144,440		171,919
Total	$	1,591,565	$	1,637,714

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At December 31, 2008, the scheduled maturities of time deposits were as follows:

2009	$	291,178
2010	107,919
2011	19,658
2012	18,369
2013	68,382
Thereafter	247
Total	$	505,753

Note 6 - Income Taxes

Income tax expense is as follows for the years ended December 31:

	2008			2007			2006
Currently payable tax
Federal	$	7,971		$	9,767		$	11,611
State	(1,311		)	—			—
Deferred tax (benefit) provison	(1,861		)	(1,269		)	(1,701		)
Total	$	4,799		$	8,498		$	9,910

A reconciliation between taxes computed at the statutory federal income tax rate and the consolidated effective tax rates follows:

	2008		2007		2006
Statutory federal income tax rate	35.0	%	35.0	%	35.0	%
Decrease in taxes resulting from:
Tax-exempt income	(2.7	)%	(1.3	)%	(1.1	)%
State income taxes, net of federal tax benefit	(3.4	)%	(1.1	)%	(1.3	)%
Dividends on ESOP shares	(5.2	)%	(4.1	)%	(2.7	)%
Other items, net	(1.5	)%	(1.9	)%	(1.8	)%
Effective tax rate	22.2	%	26.6	%	28.1	%

22

The temporary differences which created deferred tax assets and liabilities at December 31 are summarized below:

	2008		2007
Deferred tax assets
Allowance for loan losses	$	6,192	$	3,585
Deferred compensation	2,139		3,230
Unrealized loss on securities available for sale	604		674
Nonaccrual loan interest income	515		33
SFAS 158 adjustment	254		260
State net operating loss	2,053		1,474
Impairment of FHLMC preferred stock	—		152
Other	707		933
Total deferred tax assets	12,464		10,341
Deferred tax liabilities
Depreciation	799		468
Federal Home Loan Bank stock dividends	611		611
Deposit base intangible	266		252
Qualified prepaid expenses	323		330
Total deferred tax liabilities	1,999		1,661
Net deferred tax assets	$	10,465	$	8,680

Net deferred tax assets are included in accrued interest and other assets. No valuation allowance was considered necessary for net deferred tax assets. At December 31, 2008, the Company had a net operating loss carryforward for state tax purposes totaling approximately $43,300, which expire at various dates beginning in 2018.

The Company files income tax returns in the U.S. federal jurisdiction and in Illinois. The Company is no longer subject to examination by the U.S. federal tax authorities and by Illinois tax authorities for years prior to 2004.

The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, the Company was not required to recognize any additional liability for unrecognized tax benefits. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

	2008			2007
Balance at January 1	$	1,500		$	1,030
Adjustments based on tax positions	229			470
Reductions of prior year tax positions	(1,729		)	—
Balance at December 31	$	—		$	1,500

During the third quarter of 2008, a new State of Illinois tax law was passed which provided clarification on an uncertain tax position previously adopted by the Company. As a result, the Company determined that the FIN 48 reserve on the uncertain tax position was no longer necessary and $1,311 of unrecognized tax positions was reversed. The amount of unrecognized tax benefits as of December 31, 2007 was $1,082. The total amount of interest and penalties recorded in the income statement for the year ended December 31, 2008 and 2007 was not material. The amount accrued for interest and penalties at December 31, 2007 was $305.

Note 7 - Benefit Plans

During 2007, the Bank established the West Suburban Bank 401(k) Profit Sharing Plan (the “401(k) Plan”), which is anticipated to serve as the Company’s principal retirement plan. The 401(k) Plan was established to address the limited availability of West Suburban common stock for acquisition by the ESOP and to offer participants an avenue to diversify their retirement savings. The Company made contributions to the 401(k) Plan totaling $1,623 and $1,454 during 2008 and 2007, respectively.

23

The ESOP provides incentives to employees by granting participants an interest in West Suburban common stock, which represents the ESOP’s primary investment. An individual account is established for each participant, and the benefits payable upon retirement, termination, disability or death are based upon service, the amount of the employer’s contributions and any income, expenses, gains and losses and forfeitures allocated to the participant’s account. Contributions, which are determined by the board of directors of the Bank, are paid by the Bank and totaled $2,062 in 2006. The Bank did not make a contribution to the ESOP in 2008 or 2007.

At December 31, 2008 and 2007, the ESOP held 90,270 and 86,617 shares of West Suburban common stock, respectively, that were allocated to ESOP participants. Upon termination of their employment, participants who elect to receive their benefit distributions in the form of West Suburban common stock may require the Company to purchase the common stock distributed at fair value during two 60-day periods. The first purchase period begins on the date the benefit is distributed and the second purchase period begins on the first anniversary of the distribution date. This contingent repurchase obligation is reflected in the Company’s financial statements as “Common stock in ESOP subject to contingent repurchase obligation” and reduces shareholders’ equity by an amount that represents the independently appraised fair value of all West Suburban common stock held by the ESOP and allocated to participants, without regard to whether it is likely that the shares would be distributed or that the recipients of the shares would be likely to exercise their right to require the Company to purchase the shares.

During 2008 and 2007, the ESOP distributed $1,483 and $814, respectively, in cash representing the interests of participants. In addition, the ESOP distributed 192 shares in 2008 and 194 shares in 2007 of West Suburban common stock.

The Company maintains deferred compensation arrangements with certain former and current executive officers. The deferred compensation expense was $165, $165 and $190 for the years ended December 31, 2008, 2007 and 2006, respectively. Executive officers can elect to defer the payment of a percentage of their salaries and cash bonuses and members of the board of directors can elect to defer the payment of their directors’ fees. In addition, the Company makes annual contributions for the benefit of current participants ($25 for certain senior executive officers and $5 for other executive officers) in the Company’s deferred compensation arrangements. As of December 31, 2008, 13 current executive officers participated in the deferred compensation plan.

The total accumulated liability for all deferred compensation arrangements was $5,381 and $8,124 at December 31, 2008 and 2007, respectively. These amounts are included in accrued interest and other liabilities in the consolidated balance sheets.

In March 2004, the Company established a noncontributory postretirement benefit plan covering certain senior executives. The plan provides postretirement medical, dental and long term care coverage for certain executives and their surviving spouses. The eligible retirement age under the plan is age 62. The Company used a December 31 measurement date for its postretirement benefit plan. The plan is unfunded.

24

Information about changes during 2008 and 2007 in obligations of the postretirement benefit plan follows:

	2008			2007
Change in benefit obligation:
Beginning benefit obligation	$	885		$	651
Service cost	37			26
Interest cost	52			38
Actuarial loss	28			189
Benefits paid	(22		)	(19		)
Ending benefit obligation	980			885
Change in plan assets, at fair value:
Beginning plan assets	—			—
Employer contributions	22			19
Benefits paid	(22		)	(19		)
Ending plan assets	—			—
Funded (unfunded) status at December 31	$	(980	)	$	(885	)

Amounts recognized in accumulated other comprehensive loss at December 31 consist of:

	2008		2007
Net actuarial loss	$	387	$	380
Prior service cost	252		274
Total	$	639	$	654

The accumulated benefit obligation was $980 and $885 at December 31, 2008 and 2007, respectively.

Net postretirement benefit costs included the following components:

	2008			2007			2006
Service cost	$	37		$	26		$	26
Interest cost	52			38			30
Amortization of unrecognized prior service cost	21			21			21
Amortization of net loss	21			10			4
Net periodic postretirement benefit cost	131			95			81
Net loss	28			189			200
Prior service cost	—			—			295
Amortization of net gain	(21		)	(9		)	—
Amortization of prior service cost	(21		)	(21		)	—
Total recognized in other comprehensive (income) loss	(14		)	159			495
Postretirement benefit cost and other comprehensive loss	$	117		$	254		$	576

The estimated net loss and prior service costs for the defined postretirement benefit plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $27 and $21, respectively.

The discount rate used to determine net periodic benefit costs and benefit obligations in 2008 and 2007 was 6.25% and 6.00%, respectively.

25

For measurement purposes, a 10% annual rate of increase in the per capita premium cost of covered health care benefits was assumed for 2009, with rates reducing .5% per annum to an ultimate rate of 5% in 2017. Dental benefits were assumed to increase 7% for 2009 with rates reducing .5% per annum to an ultimate rate of 5% in 2012.

Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects:

	One-Percentage-Point Increase		One-Percentage-Point Decrease
Effect on total service and interest cost	$	16	$	(13	)
Effect on accumulated postretirement benefit obligation	165		(137		)

The Company expects to contribute amounts in 2009 to satisfy its obligations. The following benefit payments, which reflect expected future service, are expected for the years indicated:

2009	$	19
2010	20
2011	22
2012	15
2013	23
Following 5 Years	236

Note 8 - Off-Balance-Sheet Risk, Contingent Liabilities and Guarantees

The Company is a party to off-balance-sheet financial instruments to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. These financial instruments involve, to varying degrees, elements of credit and interest rate risks. Such financial instruments are recorded when funded.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the agreement. These commitments primarily consist of unused lines of credit, undrawn portions of construction loans and commitments to make new loans. Commitments generally have fixed expiration dates or other termination provisions and may require the payment of a fee. Since many of the commitments are expected to expire without being exercised or drawn upon, the total commitment amounts do not necessarily represent future cash requirements.

The Company’s exposure to credit risk in connection with commitments to extend credit and standby letters of credit is the contractual amount of those instruments before considering customer collateral or ability to repay. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. The Company generally requires collateral or other security to support financial instruments with credit risk. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company, is based on management’s credit evaluation of the customer. Collateral held varies and may include accounts receivable, inventory and equipment or commercial or residential properties.

26

A summary of the contractual exposure to off-balance-sheet risk as of December 31 follows:

	2008						2007
	Fixed Rate		Variable Rate		Total		Fixed Rate		Variable Rate		Total
Commercial loans and lines of credit	$	4,940	$	224,216	$	229,156	$	1,274	$	228,725	$	229,999
Check credit lines of credit	1,033		—		1,033		1,077		—		1,077
Mortgage loans	6,712		—		6,712		7,802		884		8,686
Home equity lines of credit	—		174,739		174,739		—		180,918		180,918
Letters of credit	—		22,795		22,795		—		17,663		17,663
Credit card lines of credit	—		40,267		40,267		—		40,528		40,528
Total	$	12,685	$	462,017	$	474,702	$	10,153	$	468,718	$	478,871

Fixed rate commercial loan commitments at December 31, 2008 generally had interest rates ranging from 4.97% to 7.25% with remaining terms ranging from 1 month to 5 years. Fixed rate mortgage loan commitments at December 31, 2008 generally had interest rates ranging from 5.00% to 5.375% with terms ranging from 10 to 30 years. Fixed rate check credit lines of credit had an interest rate of 18.00% as of December 31, 2008.

Note 9 - Fair Value of Financial Instruments

SFAS 157 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value as follows:

Level 1:Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2:Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3:Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The fair values of securities available for sale are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

A discounted cash flow approach is utilized by management to determine the fair value of the pooled trust preferred securities. Information such as historical and current performance of the underlying collateral, deferral/default rates, collateral coverage ratios, break in yield calculations, cash flow projections, liquidity and credit premiums required by a market participant, and financial trend analysis with respect to the individual issuing financial institutions and insurance companies, are utilized in determining individual security valuations. Due to current market conditions as well as, the limited trading activity of these securities, the market value of the securities is highly sensitive to assumption changes and market volatility. The overall discount rate and liquidity premiums utilized were highly dependent upon the credit quality of the collateral, the relative position of the tranche in the capital structure of the trust preferred security and the prepayment assumptions.

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The following assets and liabilities were measured at fair value on a recurring basis:

			Fair Value Measurements at December 31, 2008 Using
	December 31, 2008		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Available for sale securities	$	225,814	$	222,351	$	3,463

The table below presents a reconciliation and income statement classification of gains and losses for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the year ended December 31, 2008:

	Securities Available For Sale
Beginning balance, January 1, 2008	$	—
Transfers into Level 3	5,835
Increase in unrealized loss	(2,393		)
Included in earnings
Interest income on securities	21
Included in other comprehensive income	—
Ending balance, December 31, 2008	$	3,463

No changes in unrealized gains or losses were recorded through earnings for the year ended December 31, 2008.

Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

			Fair Value Measurements at December 31, 2008 Using
	December 31, 2008		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Impaired loans	$	7,352	$	—	$	7,352

Impaired loans are evaluated and valued at the lower of cost or fair value at the time the loan is identified as impaired. Fair value is measured based on the value of the collateral securing these loans and is classified at Level 3 in the fair value hierarchy. Collateral may include real estate and business assets, including equipment, inventory and accounts receivable, and is determined based on appraisals by qualified licensed appraisers retained by the Company. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and client’s business. Impaired loans are reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the factors identified above.

Impaired loans, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a carrying amount of $9,036 at December 31, 2008. The valuation allowance on impaired loans was $1,684 as of December 31, 2008. The valuation allowance made for impaired loans during 2008 was $1,263.

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Carrying values and estimated fair values of the Company’s financial instruments as of December 31 is set forth in the table below:

	2008				2007
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets
Cash and cash equivalents	$	55,474	$	55,474	$	33,183	$	33,183
Securities
Available for sale	225,814		225,814		459,405		459,405
Held to maturity	240,234		244,928		24,076		23,953
Federal Home Loan Bank stock	6,144		N/A		5,258		N/A
Loans, less allowance for loan losses	1,233,595		1,218,633		1,226,571		1,242,746
Accrued interest	6,136		6,136		7,793		7,793
Financial liabilities
Deposits	1,591,565		1,606,865		1,637,714		1,642,377
Federal funds purchased	55,000		55,000		—		—
Accrued interest	5,007		5,007		6,066		6,066

Estimated fair value for cash and cash equivalents, accrued interest receivable and payable, demand deposits and variable rate loans or deposits that reprice frequently and fully are each based on carrying value. For fixed rate loans or deposits and for variable rate loans or deposits with infrequent repricing or repricing limits, fair value is based on discounted cash flows using current market rates applied to estimated life and credit. Fair value of debt is based on current rates for similar financing. It was not practical to determine the fair value of FHLB stock due to the restrictions placed on its transferability. The fair value of off-balance-sheet items is not considered material.

Note 10 - Related Party Transactions

Certain executive officers and directors of the Company, their affiliates and companies in which they have 10% or more beneficial ownership, are customers of the Bank and received loans from the Bank totaling $9,730 and $21,316 at December 31, 2008 and 2007, respectively. During 2008, $8,215 in new loans and $8,768 in principal payments were made. An additional $11,033 decline in the related party loan balances relates to the resignation of a director of the Bank during 2008. Related parties maintained deposits at the Bank totaling $49,261 and $51,442 at December 31, 2008 and 2007, respectively.

Note 11 - Capital Requirements

The Company and the Bank are subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements may result in the initiation of actions by regulators that could have direct material effects on the financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, each entity must meet specific capital guidelines that involve quantitative measures of assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgements by the regulators about components, risk weightings and other factors.

Regulations require the Company and the Bank to maintain minimum capital amounts and ratios (set forth in the following table). Management believes that as of December 31, 2008, the Company and the Bank exceeded all capital adequacy requirements.

Management’s present policy is to limit dividends from the Bank so that the Bank qualifies as a “well-capitalized” institution as defined by the Federal Deposit Insurance Corporation Improvement Act of 1991. This policy minimizes the amount of Federal Deposit Insurance Corporation (“FDIC”) insurance premiums paid by the Bank

29

and provides capital to fund growth. As of December 31, 2008, the Bank could pay, in the aggregate, dividends of approximately $15,100 to West Suburban while remaining a “well-capitalized” institution. Dividends from the Bank are West Suburban’s primary source of cash flow.

As of December 31, 2008 and 2007, the most recent notifications from the FDIC categorized the Bank as “well- capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well-capitalized”, the Bank must maintain minimum ratios for total capital to risk weighted assets, Tier 1 capital to risk weighted assets and Tier 1 capital to average assets as set forth in the following table. There are no conditions or events since that notification that management believes would result in a change of the category.

The capital amounts and ratios of the Company and the Bank for purposes of the prompt corrective action framework are presented in the table below:

	Actual				Minimum For Capital Adequacy Purposes				Minumum To Be Well- Capitalized
	Amount		Ratio		Amount		Ratio		Amount	Ratio
As of December 31, 2008
Total capital (to risk weighted assets)
Company	$	177,062	12.1	%	$	117,232	8.0	%	N/A	N/A
Bank	161,575		11.0	%	117,136		8.0	%	146,421	10.0	%
Tier 1 capital (to risk weighted assets)
Company	161,484		11.0	%	58,616		4.0	%	N/A	N/A
Bank	145,997		10.0	%	58,568		4.0	%	87,852	6.0	%
Tier 1 capital (to average assets)
Company	161,484		8.7	%	74,317		4.0	%	N/A	N/A
Bank	145,997		7.9	%	74,065		4.0	%	92,581	5.0	%
As of December 31, 2007
Total capital (to risk weighted assets)
Company	$	171,440	11.7	%	$	117,473	8.0	%	N/A	N/A
Bank	150,495		10.3	%	117,330		8.0	%	146,663	10.0	%
Tier 1 capital (to risk weighted assets)
Company	162,170		11.0	%	58,736		4.0	%	N/A	N/A
Bank	141,225		9.6	%	58,665		4.0	%	87,998	6.0	%
Tier 1 capital (to average assets)
Company	162,170		8.8	%	73,848		4.0	%	N/A	N/A
Bank	141,225		7.7	%	73,688		4.0	%	92,109	5.0	%

The appraised fair value of West Suburban common stock owned by the ESOP is included in Tier 1 capital.

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Note 12 - Other Comprehensive Income

Other comprehensive income components and related taxes were as follows:

	2008			2007			2006
Net unrealized holding gain on available for sale securities	$	277		$	6,968		$	4,862
Reclassification adjustments for (gains) and losses later recognized in income	(101		)	387			(85		)
Tax effect	(70		)	(2,923		)	(1,899		)
Net unrealized gain on available for sale securities	106			4,432			2,878
Change in postretirement obligation, gain (loss)	15			(159		)	—
Tax effect	(6		)	63			—
Net change in postretirement obligation, gain (loss)	9			(96		)	—
Other comprehensive income	$	115		$	4,336		$	2,878

Note 13 - Condensed Financial Information - Parent Only

Condensed Balance Sheets
December 31, 2008 and 2007

	2008		2007
Assets
Cash	$	14,977	$	17,632
Securities available for sale (amortized cost of $0 in 2008 and $2,948 in 2007)	—		2,912
Securities held to maturity (fair value of $4,427 in 2008 and $4,510 in 2007)	4,703		4,564
Investment in subsidiary	144,822		139,956
Other assets	985		1,029
Total assets	$	165,487	$	166,093
Liabilities and shareholders’ equity
Dividends payable	$	4,325	$	4,325
Other liabilities	263		300
Common stock in ESOP subject to contingent repurchase obligation	46,670		56,907
Shareholders’ equity	114,229		104,561
Total liabilities and shareholders’ equity	$	165,487	$	166,093

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Condensed Statements of Income
Years Ended December 31, 2008, 2007 and 2006

	2008			2007		2006
Income
Dividends from subsidiary	$	11,761		$	20,558	$	20,755
Interest income
Deposits	242			513		573
Securities	279			291		291
Net realized gains on securities transactions	16			—		—
Other	13			—		56
Total income	12,311			21,362		21,675
Expense
Other	659			417		382
Total expense	659			417		382
Income before income taxes	11,652			20,945		21,293
Income tax (benefit) expense	(190		)	14		120
Income before equity in undistributed net income of subsidiary	11,842			20,931		21,173
Equity in undistributed net income of subsidiary	4,974			2,482		4,178
Net income	$	16,816		$	23,413	$	25,351

Condensed Statements of Cash Flows
Years Ended December 31, 2008, 2007 and 2006

	2008			2007			2006
Cash flows from operating activities
Net income	$	16,816		$	23,413		$	25,351
Adjustments to reconcile net income to net cash provided by operating activities
Deferred income tax (benefit) provision	(7		)	7			8
Equity in undistributed net income of subsidiary	(4,974		)	(2,482		)	(4,178		)
Net discount accretion of securities	(131		)	(121		)	(121		)
Net realized gains on securities transactions	(16		)	—			—
Decrease (increase) in other assets	37			(69		)	(42		)
(Decrease) increase in other liabilities	(37		)	41			49
Net cash provided by operating activities	11,688			20,789			21,067
Cash flows from investing activities
Securities available for sale
Sales	2,472			—			—
Maturities and calls	485			—			—
Net cash provided by investing activities	2,957			—			—
Cash flows from financing activities
Cash dividends paid	(17,300		)	(21,625		)	(21,625		)
Net cash used in financing activities	(17,300		)	(21,625		)	(21,625		)
Net decrease in cash	(2,655		)	(836		)	(558		)
Beginning cash	17,632			18,468			19,026
Ending cash	$	14,977		$	17,632		$	18,468

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Note 14 - Quarterly Results of Operations (Unaudited)

The following table sets forth certain unaudited income, expense and per share data on a quarterly basis for the three-month periods indicated:

	Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Year Ended December 31, 2008
Interest income	$	22,534	$	23,785	$	23,876	$	24,865
Interest expense	7,567		7,951		8,331		10,123
Net interest income	14,967		15,834		15,545		14,742
Provision for loan losses	3,250		4,060		2,200		850
Net interest income after provision for loan losses	11,717		11,774		13,345		13,892
Noninterest income	5,854		7,076		7,312		8,428
Noninterest expense	13,848		14,301		15,133		14,501
Income before income taxes	3,723		4,549		5,524		7,819
Income tax expense	1,308		72		1,277		2,142
Net income	$	2,415	$	4,477	$	4,247	$	5,677
Earnings per share	$	5.58	$	10.35	$	9.82	$	13.13
Year Ended December 31, 2007
Interest income	$	26,048	$	27,647	$	27,673	$	27,094
Interest expense	11,661		12,304		12,160		12,081
Net interest income	14,387		15,343		15,513		15,013
Provision for loan losses	275		100		—		—
Net interest income after provision for loan losses	14,112		15,243		15,513		15,013
Noninterest income	6,846		7,075		6,814		6,329
Noninterest expense	14,547		13,799		13,769		12,919
Income before income taxes	6,411		8,519		8,558		8,423
Income tax expense	1,480		2,444		2,506		2,068
Net income	$	4,931	$	6,075	$	6,052	$	6,355
Earnings per share	$	11.40	$	14.04	$	14.00	$	14.69

33

STOCK PERFORMANCE PRESENTATION

The stock performance graph below shall not be deemed incorporated by reference by any general statement incorporating by reference this annual report into any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except to the extent West Suburban specifically incorporates this information by reference, and shall not otherwise be deemed filed under such Acts.

The Securities and Exchange Commission requires that West Suburban include a line-graph presentation comparing cumulative, five-year shareholder returns on an indexed basis with the Standard & Poor’s 500 Stock Index (“S&P 500”) and either a nationally recognized industry standard or an index of peer companies selected by West Suburban. The Board of Directors has elected to compare an investment in its stock to a peer group index rather than a published industry index because it believes the peer group index includes companies whose businesses are more similar to that of the Company than any published index. The “old peer group” index is comprised of the following companies selected by West Suburban (based on their similarity in size, loan portfolios and business markets): 1st Source Corporation; AMCORE Financial Inc.; Corus Bankshares Inc.; MB Financial Inc.; Midwest Banc Holdings Inc.; Old Second Bancorp, Inc.; PrivateBancorp, Inc.; and Wintrust Financial Corporation. The “new peer group” index is intended to reflect a broader group of comparable companies as of a current date. The “new peer group” index is comprised of the following companies selected by West Suburban (based on their similarity in size, loan portfolios and business markets): 1st Source Corporation; AMCORE Financial Inc.; Corus Bankshares Inc.; MB Financial Inc.; Midwest Banc Holdings Inc.; Old Second Bancorp, Inc.; PrivateBancorp, Inc.; Taylor Capital Group, Inc.; and Wintrust Financial Corporation.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among West Suburban Bancorp, Inc., The S&P 500 Index,
An Old Peer Group And A New Peer Group

*$100 invested on 12/31/03 in stock or index, including reinvestment of dividends.
Fiscal year ending December 31.

Copyright© 2009 S&P, a division of The McGraw-Hill Companies Inc. All rights reserved.

34

The following table sets forth the dollar amounts of the annual Total Returns (as defined below) for the Company, the S&P 500, the “old peer group” and the “new peer group”, which are plotted on the line graph on the previous page. “Total Return” means the sum of dividends received, assuming dividend reinvestment, and the increase (or decrease) in the share price at the end of the period compared to the beginning of the period, divided by the share price at the beginning of the period.

	Total Return Based on Initial Investment of $100.00
	2003		2004		2005		2006		2007		2008
The Company	$	100.00	$	108.54	$	115.92	$	132.23	$	131.32	$	108.18
S&P 500	$	100.00	$	110.88	$	116.33	$	134.70	$	142.10	$	89.53
Old Peer Group	$	100.00	$	128.96	$	131.08	$	134.15	$	92.78	$	61.11
New Peer Group	$	100.00	$	129.31	$	132.41	$	134.62	$	92.19	$	59.24

The Total Returns of the companies included in the above peer groups have been assigned various weights based on their relative market capitalizations.

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SELECTED FINANCIAL DATA

(Dollars in thousands, except per share data)

The following information should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Company’s Consolidated Financial Statements and Notes to Consolidated Financial Statements included in this annual report.

	Years Ended December 31,
	2008			2007			2006			2005			2004
Selected operating data
Interest income	$	95,060		$	108,462		$	105,736		$	89,389		$	79,326
Interest expense	33,972			48,206			45,334			30,269			21,839
Net interest income	61,088			60,256			60,402			59,120			57,487
Provision for loan losses	10,360			375			150			1,375			200
Net interest income after provision for loan losses	50,728			59,881			60,252			57,745			57,287
Noninterest income (1)	28,670			27,064			22,865			23,571			18,407
Noninterest expense	57,783			55,034			47,856			45,507			43,107
Income before income taxes	21,615			31,911			35,261			35,809			32,587
Income tax expense	4,799			8,498			9,910			10,323			8,929
Net income	$	16,816		$	23,413		$	25,351		$	25,486		$	23,658
Per share data
Earnings	$	38.88		$	54.13		$	58.62		$	58.93		$	54.82
Cash dividends declared	40.00			50.00			50.00			50.00			50.00
Book value (2)	372.03			373.34			359.18			344.60			347.87
Selected balances, end of year
Securities	$	472,192		$	488,739		$	503,201		$	536,362		$	558,883
Loans, less allowance for loan losses	1,233,595			1,226,571			1,153,885			1,091,747			1,046,125
Total assets	1,867,558			1,851,357			1,876,643			1,827,191			1,748,049
Deposits	1,591,565			1,637,714			1,677,844			1,639,666			1,569,742
Shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation (2)	160,899			161,468			155,344			149,038			150,454
Ratios
Return on average total assets	0.90		%	1.26		%	1.38		%	1.43		%	1.36		%
Return on average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation (2)	10.40		%	14.83		%	16.83		%	17.05		%	15.58		%
Cash dividends declared to net income	102.88		%	92.36		%	85.30		%	84.85		%	91.41		%
Average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation to average total assets (2)	8.67		%	8.49		%	8.18		%	8.40		%	8.73		%
Net interest margin (3)	3.58		%	3.50		%	3.54		%	3.59		%	3.60		%

(1)	Noninterest income includes gains (losses) on sales on securities of $101 in 2008, ($6) in 2007, $85 in 2006, $206 in 2005 and ($2,004) in 2004. Noninterest income for 2007 includes the impairment of FHLMC stock of ($381).
(2)	See Note 7 to the Company’s consolidated financial statements and “Non-GAAP Financial Measures.” This presentation is consistent with the Company’s belief that it is unlikely that the Company would be required to satisfy the contingent repurchase obligation.
(3)	Net interest margin is presented on a tax equivalent basis, assuming a federal income tax rate of 35%.

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NON-GAAP FINANCIAL MEASURES

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States (“GAAP”). However, management uses certain non-GAAP measures and ratios to evaluate and measure the Company’s performance. These measures and ratios include book value per share, return on shareholders’ equity and average shareholders’ equity to average total assets. For each of these measures and ratios, the Company adds to shareholders’ equity the amount in “common stock in ESOP subject to contingent repurchase obligation.” Under the ESOP, the Company has certain contingent repurchase obligations to buy back common stock distributed to participants, as described in more detail in Note 7 to the Company’s audited financial statements. This contingent repurchase obligation is reflected in the Company’s financial statements as “common stock in ESOP subject to contingent repurchase obligation” and, in accordance with GAAP, reduces shareholders’ equity. The Company believes that it is unlikely that the Company would be required to satisfy its contingent repurchase obligation and therefore believes that adjusting shareholders’ equity by adding “common stock in ESOP subject to contingent repurchase obligation” to that amount provides a more meaningful view of the applicable measures and ratios. In addition, management believes that the return on average shareholders’ equity, a financial measure frequently considered to evaluate the performance of bank holding companies, would be significantly overstated.

The following table presents a reconciliation of certain non-GAAP performance measures and ratios used by the Company to the most directly comparable GAAP financial measures for the years ended December 31:

	2008			2007			2006			2005			2004
Shareholders’ equity (GAAP)	$	114,229		$	104,561		$	95,335		$	94,660		$	96,495
Shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation (non-GAAP)	160,899			161,468			155,344			149,038			150,454
Book Value Per Share (GAAP) (1)	264.12			241.76			220.43			218.87			223.60
Book Value Per Share (non-GAAP) (2)	372.03			373.34			359.18			344.60			347.87
Return on average shareholders’ equity (GAAP) (3)	16.01		%	24.04		%	27.05		%	26.62		%	23.64		%
Return on average shareholders’equity plus common stock in ESOP subject to contingent repurchase obligation (non-GAAP) (4)	10.40		%	14.83		%	16.83		%	17.05		%	15.58		%
Average shareholders’ equity to average total assets (GAAP) (5)	5.63		%	5.24		%	5.09		%	5.38		%	5.75		%
Average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation to average total assets (non-GAAP) (6)	8.67		%	8.49		%	8.18		%	8.40		%	8.73		%

(1)	Book Value Per Share (GAAP) equals shareholders’ equity divided by the number of outstanding shares.
(2)	Book Value Per Share (non-GAAP) equals shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation divided by the number of outstanding shares.
(3)	Return on average shareholders’ equity (GAAP) equals net income divided by average shareholders’ equity.
(4)	Return on average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation (non-GAAP) equals net income divided by average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation.
(5)	Average shareholders’ equity to average total assets (GAAP) equals average shareholders’ equity divided by average total assets.
(6)	Average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation to average total assets (non-GAAP) equals average shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation divided by average total assets.

37

AVERAGE BALANCE SHEETS, NET INTEREST INCOME AND
AVERAGE RATES AND YIELDS ON A TAX EQUIVALENT BASIS

(Dollars in thousands)

The following table presents for the years indicated the total dollar amount of interest income from average interest-earning assets and their yields, as well as the interest expense on average interest-bearing liabilities and their costs, expressed both in dollars and rates. All average balances are daily average balances. To the extent received, interest on nonaccruing loans has been included in the table.

	Years Ended December 31,
	2008							2007							2006
	Average Balance			Interest		Rate		Average Balance			Interest		Rate		Average Balance			Interest		Rate
Assets
Federal funds sold	$	7,898		$	198	2.5	%	$	58,267		$	3,061	5.3	%	$	58,208		$	2,932	5.0	%
Securities
Taxable	465,555			21,109		4.5	%	467,953			19,192		4.1	%	503,161			19,222		3.8	%
Exempt from federal income tax (1)	30,428			1,809		5.9	%	27,789			1,725		6.2	%	25,684			1,600		6.2	%
Total securities (1)	495,983			22,918		4.6	%	495,742			20,917		4.2	%	528,845			20,822		3.9	%
Loans (1)(2)	1,231,226			72,916		5.9	%	1,185,439			85,181		7.2	%	1,136,102			82,574		7.3	%
Total interest-earning assets (1)(2)	1,735,107			96,032		5.5	%	1,739,448			109,159		6.3	%	1,723,155			106,328		6.2	%
Cash and due from banks	34,877							38,444							40,142
Premises and equipment, net	43,827							42,074							40,124
Other real estate	997							627							550
Allowance for loan losses	(11,505		)					(9,985		)					(10,721		)
Accrued interest and other assets (2)	61,977							49,648							47,808
Total assets	$	1,865,280						$	1,860,256						$	1,841,058
Liabilities and shareholders’ equity
Interest-bearing deposits
NOW	$	307,033		1,347		0.4	%	$	306,680		2,881		0.9	%	$	315,209		2,873		0.9	%
Money market checking	326,367			8,021		2.5	%	290,610			12,415		4.3	%	254,492			10,642		4.2	%
Savings	334,266			2,627		0.8	%	359,173			6,347		1.8	%	398,013			8,920		2.2	%
Time deposits
Less than $100,000	368,943			15,282		4.1	%	393,708			18,516		4.7	%	381,062			16,005		4.2	%
$100,000 and greater	146,492			6,031		4.1	%	164,785			8,044		4.9	%	154,178			6,863		4.5	%
Total interest-bearing deposits	1,483,101			33,308		2.2	%	1,514,956			48,203		3.2	%	1,502,954			45,303		3.0	%
Other interest-bearing liabilities	32,375			664		2.1	%	65			3		4.6	%	738			31		4.2	%
Total interest-bearing liabilities	1,515,476			33,972		2.2	%	1,515,021			48,206		3.2	%	1,503,692			45,334		3.0	%
Demand-noninterest-bearing deposits	138,106							145,314							152,423
Accrued interest and other liabilities	50,035							42,001							34,315
Shareholders’ equity plus common stock in ESOP subject to contingent repurchase obligation (3)	161,663							157,920							150,628
Total liabilities and shareholders’ equity	$	1,865,280						$	1,860,256						$	1,841,058
Net interest income				$	62,060						$	60,953						$	60,994
Interest rate spread						3.3	%						3.1	%						3.2	%
Net interest margin (1)						3.6	%						3.5	%						3.5	%

(1)	Interest income, net interest margin and yields are presented on a tax equivalent basis, assuming a federal income tax rate of 35%.
(2)	The average balances of nonaccrual loans are included in accrued interest and other assets.
(3)	See Note 7 to the Company’s consolidated financial statements and “Non-GAAP Financial Measures.” This presentation is consistent with the Company’s belief that it is unlikely that the Company would be required to satisfy the contingent repurchase obligation.

38

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

The following discussion and analysis provides information regarding the Company’s financial condition as of December 31, 2008 and 2007, and the results of operations for each of the three years in the period ended December 31, 2008. This discussion and analysis should be read in conjunction with the Company’s Consolidated Financial Statements and Notes to Consolidated Financial Statements included in this annual report. The financial information provided below is rounded in order to simplify the presentation of management’s discussion and analysis. However, the ratios and percentages provided below are calculated using the more detailed financial information contained in the financial statements, notes and tables included elsewhere in this annual report.

Critical Accounting Policies

The Company’s financial statements are prepared in conformity with accounting principles generally accepted in the United States of America. These accounting principles, which can be complex, are significant to our financial condition and our results of operations and require management to apply significant judgment with respect to various accounting, reporting and disclosure matters. Management must use estimates, assumptions and judgments to apply these principles where actual measurements are not possible or practical. These estimates, assumptions and judgments are based on information available as of the date of this report and, as this information changes, actual results could differ from the estimates, assumptions and judgments reflected in the financial statements. Changes in such estimates may have a significant impact on the financial statements. Management has reviewed the application of these policies with the Audit Committee of West Suburban’s Board of Directors. This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction the Company’s Consolidated Financial Statements and Notes to Consolidated Financial Statements included in this annual report.

In management’s view, the accounting policies that are critical to the Company are those relating to estimates, assumptions and judgments regarding the determination of the adequacy of the allowance for loan losses, the Company’s federal and state tax obligations and the determination of the fair value of certain of the Company’s investment securities.

Allowance for Loan Losses. The Company maintains an allowance for loan losses at a level management believes is sufficient to absorb probable incurred credit losses in the loan portfolio. The allowance for loan losses represents the Company’s estimate of probable incurred credit losses in the loan portfolio at each balance sheet date and is based on the review of available and relevant information. The allowance contains allocations for probable incurred credit losses that have been identified relating to specific borrowing relationships as well as probable incurred credit losses for pools of loans. The allowance for loan losses is reassessed monthly by the Company to determine the appropriate level of the allowance. The amount of the allowance for loan losses is determined based on a variety of factors, including assessment of the credit risk of the loans in the loan portfolio, volume of the loans, delinquent loans, evaluation of current economic conditions in the market area, actual charge-offs during the period and historical loss experience. Loan quality is continually monitored by management and reviewed by the loan committee on a monthly basis.

All categories of loans are evaluated on a category by category basis. In addition, individual commercial, construction and commercial mortgage loans are evaluated to determine if a specific loss allocation is needed for problem loans deemed to have a shortfall in collateral. Management also considers the borrower’s current economic status including liquidity and future business viability. Other factors used in the allocation of the allowance include levels and trends of past dues and charge-offs along with concentrations of credit within the commercial and commercial real estate loan portfolios. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available or as developments occur. Along with the allocation of the allowance on a category by category basis and the specific allocations for individual borrowing relationships, the allowance includes a relatively small portion that remains unallocated. Management adjusts the allowance for loan losses by an amount sufficient to maintain the allowance at the level determined appropriate. Loans are charged-off when deemed to be uncollectible by management. The Company believes that the allowance for loan losses is adequate to provide for estimated probable incurred credit losses in the loan portfolio.

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Income Taxes. The Company is subject to income tax laws of the United States and the State of Illinois. These laws are complex and subject to different interpretations by the taxpayer and the various taxing authorities. Management makes certain judgments and estimates about the application of these inherently complex laws when determining the provision for income taxes. Federal and state taxing authorities have recently become increasingly aggressive in challenging tax positions taken by financial institutions, including positions that may be taken by the Company. During the preparation of the Company’s tax returns, management makes reasonable interpretations of the tax laws which are subject to challenge upon audit by the tax authorities. These interpretations are also subject to reinterpretation based on management’s ongoing assessment of facts and evolving case law.

On a quarterly basis, management evaluates the reasonableness of its effective tax rate based upon its current best estimate of net income and applicable taxes expected for the full year. Deferred tax assets and liabilities are evaluated on a quarterly basis, or more frequently if necessary.

Temporary Decline in Fair Value of Securities. The Company evaluates its securities for other-than-temporary impairment under FSP SFAS 115-1 or EITF 99-20. FSP SFAS 115-1 applies to debt securities within the scope of SFAS 115, as well as equity securities not accounted for under the equity method (i.e., cost method investments), unless the investments are subject to other accounting guidance, such as EITF 99-20. Investments in securitized structures such as collateralized mortgage obligations and collateralized debt obligations that are not high quality investment grade securities upon acquisition are subject to EITF 99-20. High quality investment grade securities are defined as securities with an investment grade of “AA” or higher.

In accordance with FSP SFAS 115-1, declines in the fair value of securities below their cost that are other-than-temporary are reflected as realized losses. Management evaluates all debt securities, except for trust preferred securities, to determine if management has the intent and ability to hold the securities until their maturity date and no concerns exist with the respect to the ability of the issuer to satisfy its obligations at maturity.

Management evaluates pooled trust preferred securities in accordance with EITF 99-20, which requires the evaluation of the expected cash flows to determine whether there has been an adverse change in the expected cash flows. Additionally, the Company monitors investment grades on the pooled trust preferred securities to determine whether there has been an adverse change in the investment grades and performs an analysis of the underlying collateral to determine a break in yield point. Any adverse changes in expected cash flows that are other-than-temporary are reflected as realized losses.

Contractual Obligations, Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities

Through the normal course of operations, the Company has entered into certain contractual obligations and other commitments. Such obligations generally relate to the funding of operations through deposits, as well as leases for premises and equipment. As a financial services provider, the Company routinely enters into commitments to extend credit. While contractual obligations represent future cash requirements of the Company, a significant portion of commitments to extend credit may expire without being drawn upon. Such commitments are subject to the same credit policies and approval as comparable loans made by the Company.

40

The following table presents the Company’s significant fixed and determinable contractual obligations and significant commitments by payment date as of December 31, 2008 (dollars in thousands). The payment amounts represent those amounts contractually due to the recipient and do not include any carrying value adjustments. Further discussion of the nature of each obligation is included in the referenced Note to the Company’s Consolidated Financial Statements included in this annual report.

	Note Reference	One Year or Less		Over One Year to Three Years		Over Three Years to Five Years		Over Five Years		Total
Deposits without a stated maturity	5	$	1,085,812	$	—	$	—	$	—	$	1,085,812
Time deposits	5	291,178		127,577		86,751		247		505,753
Prepaid solutions cards		37,964		—		—		—		37,964
Operating Leases	4	717		1,039		543		558		2,857
Commitments to extend credit
Fixed rate	8									12,685
Variable rate	8									462,017

Balance Sheet Analysis

Total Assets. Total consolidated assets at December 31, 2008 increased .9% from the prior year-end. This increase was primarily due to increases in cash and cash equivalents and the loan portfolio partially offset by decreases in the securities portfolio. Total average assets in 2008 increased .3% from the prior year primarily due to an increase in average loans outstanding.

Cash and Cash Equivalents. Cash and cash equivalents at December 31, 2008 increased 67.2% from the prior year-end primarily due to an increase in federal funds sold. Although rates paid on federal funds sold are currently at historically low levels, the Company believes that it is prudent to maintain a higher level of liquidity with the current state of the economy.

Securities. The Company’s securities portfolio decreased 3.4% at December 31, 2008 from the prior year-end. This decrease was primarily due to maturities, calls and sales of securities issued by U.S. government sponsored entities along with maturities and sales of corporate securities. This decrease was partially offset by purchases of mortgage-backed securities. The Company manages its investment portfolio to maximize the return on invested funds within acceptable risk guidelines, to meet pledging and liquidity requirements, and to adjust balance sheet interest rate sensitivity in an effort to insulate net interest income against the impact of interest rate changes. During 2008, the Company purchased approximately $262.6 million in securities and designated approximately $240.4 million of the securities as held to maturity. The purchases significantly increased the percentage of securities classified as held to maturity. The majority of new securities purchased consisted of amortizing mortgage-backed securities issued by U.S. government agencies. Classifying the new purchases as held to maturity reflects the Company’s then current investment intent and allows the Company to maintain a steady level of cash flows and limit the effect of fluctuations in market prices of these securities. The Company will continue to monitor its level of available for sale and held to maturity securities and will classify new securities purchased in the appropriate category at the time of purchase.

Securities available for sale are carried at fair value, while securities held to maturity and Federal Home Loan Bank stock are carried at historical cost. Security portfolio gross unrealized gains of $9.9 million were offset by gross unrealized losses of $6.7 million as of December 31, 2008, as compared with gross unrealized gains of $1.9 million and gross unrealized losses of $3.7 million as of December 31, 2007.

Fair values for municipal securities are generally determined by matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities. Characteristics utilized by matrix pricing include insurer, credit support, state of issuance, and bond rating. These factors are used to incorporate additional spreads and municipal curves. A separate curve structure is used for bank-qualified municipal

41

bonds. This structure is different than the approach used for general market municipals. For the bank-qualified municipal bonds, active quotes are obtained when available.

Fair values for U.S. government sponsored entity issued securities are determined using a combination of daily closing prices, evaluations, income data, security master (descriptive) data, and terms and conditions data. Additional data used to compute the fair value of U.S. government sponsored entity issued mortgage-backed pass-through securities (FHLMC, FNMA, and GNMA pools) includes daily composite seasoned, pool-specific, and generic coupon evaluations, and factors and descriptive data for individual pass-through pools. Additional data used to compute the fair value of U.S. government sponsored entity issued collateralized mortgage obligations include daily evaluations and descriptive data.

Our pooled trust preferred securities were priced using significant unobservable inputs. These securities were historically priced using Level 2 inputs and the decline in the level of observable inputs and market activity in this class of investments by the measurement date has been significant and resulted in unreliable external pricing. Broker pricing and bid/ask spreads, when available, vary widely. The once active market has become comparatively inactive. As such, these investments are now priced using Level 3 inputs.

A discounted cash flow approach is used to calculate the Level 3 fair values for trust preferred securities. The approach has a two step process to calculate the fair value. The first step is to evaluate the credit quality of the collateral and the deal structure. The process produces expected cash flows that have been adjusted for expected credit events based upon a credit component of the discount rate. The expected cash flows are then further discounted for liquidity premium to produce a discounted cash flow valuation.

To test the fair values calculated by the discounted cash flow approach, management analyzed the effective discount rate implied by the process. The test assumes an effective discount rate using targeted prepayment/maturity dates of 10, 20 and 30 years from the original issue date. Each calculation uses the contractual cash flows and was performed through Bloomberg YA screen. The discount rate is all-inclusive since it includes the risk free rate, a credit component and a spread for liquidity. Management then reviewed the effective discount rate for reasonableness. The effective discount rates range from 18% to 28% over a 10 year time horizon to 8% to 21% over a 30 year time horizon.

Loans. Total loans outstanding at December 31, 2008 increased 1.1% from the prior year-end primarily due to growth in the residential and commercial real estate and commercial loan portfolios. The growth in the residential real estate loan portfolio was primarily due to increases in originations of fixed rate loans. The commercial real estate loan portfolio increased primarily due to the addition of several large relationships. Outstanding balances in the commercial loan portfolio increased as customers used a portion of their available lines of credit. These increases were partially offset by decreases in the construction and home equity loan portfolios. The construction loan portfolio decreased primarily due to normal portfolio runoff, as well as builders displaying market discipline by not adding to their present inventory. Additionally, the completion of land development projects, as well as a significant slowdown in new activity in the construction loan portfolio also contributed to the decrease. The decrease in the home equity loan portfolio was primarily due to payoffs as a result of refinancing activity, as well as reduced home equity originations. Although the Company makes loans primarily to customers throughout the western suburbs of Chicago, the Company maintains two large lending relationships aggregating $20.6 million outside of this market area, specifically in Arizona and Florida.

42

Allowance for Loan Losses and Asset Quality. The ratio of the allowance for loan losses to total loans outstanding was 1.25% and .75% at December 31, 2008 and 2007, respectively. The following table is an analysis of the Company’s nonperforming loans and other real estate at December 31 (dollars in thousands):

	2008			2007			2006
Loans past due 90 days or more still on accrual	$	1,705		$	480		$	319
Nonaccrual loans	23,569			2,297			1,131
Total nonperforming loans	$	25,274		$	2,777		$	1,450
Nonperforming loans as a percent of total loans	2.02		%	0.22		%	0.12		%
Allowance for loan losses as a percent of nonperforming loans	62		%	334		%	734		%
Other real estate	$	4,658		$	824		$	351
Nonperforming assets as a percent of total assets	1.60		%	0.19		%	0.10		%

Net loan charge-offs were $4.1 million and $1.8 million in 2008 and 2007, respectively. The increase was primarily due to the charge-offs of two fully reserved commercial credits. Nonperforming loans (nonaccrual and loans past due 90 days or more still on accrual) increased to $25.3 million at December 31, 2008 from $2.8 million at December 31, 2007. Nonaccrual loans increased to $23.6 million at December 31, 2008 from $2.3 million at December 31, 2007 as a result of additions of five large loan relationships to nonaccrual status. The Company’s loans past due 90 days or more still on accrual increased to $1.7 million at December 31, 2008 from $.5 million at December 31, 2007. The increase was primarily due to seven residential real estate loans totaling approximately $1.0 million becoming 90 days or more past due during the fourth quarter of 2008. These loans are well secured and in the process of collection.

The provision for loan losses increased $10.0 million in 2008. The Company determined that additional loan loss provisions were necessary due to the increased levels of charge-offs and nonperforming loans, an increase in loan loss reserves allocated to specific impaired loans and downward trends in the national and local economies.

Approximately $1.7 million, or 10.9%, of the $15.6 million allowance for loan losses at December 31, 2008, relates to loans specifically reserved. This compares to a specific reserve of $.1 million, or 4.6%, of the total allowance for loan losses at December 31, 2007. The increase in the percent of the portfolio from specific reserves is attributable to a higher overall balance of impaired loans at December 31, 2008, as compared to 2007, decreases in value assigned to collateral, especially for construction loans. The general reserve as a percent of overall loans, net of unearned discount, was 1.11% at December 31, 2008, as compared to .72% at December 31, 2007. The increase in the general reserve as a percent of loans, net of unearned discount, is due to actual historical losses, management’s review of internal classified loans, management’s expectation of overall economic conditions in the areas in which the Company operates and management’s expected losses with the overall level of real estate loans within the Company’s portfolio.

Bank-Owned Life Insurance (“BOLI”). The carrying value of BOLI decreased to $35.4 million at December 31, 2008 from $37.3 million at December 31, 2007. This decrease was due to a decline in the market value of the underlying investments associated with the insurance policies that are tied to the deferred compensation plan. The decline was a direct result of the market conditions that existed during the year. The underlying investments consist of mutual funds and the investment decisions are made by the participants in the deferred compensation plan. This decrease was partially offset by BOLI purchases of $.3 million.

Other Real Estate. During 2008, the Company acquired properties with an aggregate carrying value of $4.4 million. Of this amount, $3.2 million was transferred to other real estate during December 2008 and consisted of three construction properties. During 2008, the Company sold properties with an aggregate carrying value of $.5 million. On a monthly basis, the Company evaluates the carrying value of all other real estate properties and takes write-downs on other real estate properties as necessary. During 2008, the write-downs, which totaled $.1 million, related to an existing other real estate property and were attributed to the lack of marketability.

Deposits. Total deposits at December 31, 2008 decreased 2.8% from the prior year-end primarily due to decreases in short-term time deposits. Additionally, the Company experienced decreased balances for all other deposit

43

components with the exception of money market checking. Management believes that in the current interest rate environment some customers have migrated from non-liquid time deposits to more liquid deposit products such as money market checking. In general, management promotes the Company’s deposit products when it believes appropriate and prices the Company’s products in a manner intended to retain the Company’s current customers, as well as attract new customers while maintaining an acceptable net interest margin.

Federal Funds Purchased. Federal funds purchased at December 31, 2008 increased $55.0 million from the prior year-end as the result of a purchase by the Company of 90 day term funds that remained outstanding as of year-end. The interest rates offered by the Federal Reserve were more attractive than the interest rates available from alternative funding sources.

Prepaid Solutions Cards. Outstanding balances on prepaid solutions cards at December 31, 2008 increased 54.0% from the prior year-end. This increase was primarily due to growth in four existing programs, including payroll and phone gift cards.

Capital Resources

Shareholders’ equity at December 31, 2008 increased 9.2% from December 31, 2007, as a result of $16.8 million of net income, and increases resulting from changes of $10.2 million in the amount reclassified on ESOP shares and $.1 million in accumulated other comprehensive loss, which amounts were reduced by regular dividends declared of $17.3 million. The Company eliminated the special dividend in 2008, in an effort to continue to maintain its strong capital levels. In addition, the Company has applied for, but has not yet decided to participate in, the U.S. Treasury’s Capital Purchase Program. If the Company elects to participate in the program, the Company will become subject to significant additional capital restrictions, including limitations on increases in dividends and a prohibition against certain stock repurchases.

All capital ratios are in excess of the regulatory capital requirements which call for a minimum total risk-based capital ratio of 8% for each of the Company and the Bank, a minimum Tier 1 risk-based capital ratio of 4% for each of the Company and the Bank and a minimum leverage ratio (3% for the most highly rated banks and bank holding companies that do not expect significant growth; all other institutions are required to maintain a minimum leverage capital ratio of 4% to 5% depending on their particular circumstances and risk and growth profiles) for each of the Company and the Bank. Bank holding companies and their subsidiaries are generally expected to operate at or above the minimum capital requirements. All capital ratios are in excess of regulatory minimums and should allow the Company and the Bank to operate without significant capital adequacy concerns. In addition, the Bank formed a subsidiary in 2004 that participates in the Bank’s real estate lending business and is intended to qualify as a real estate investment trust. This subsidiary is also intended to facilitate capital raising efforts, if such efforts become necessary, by enabling the Bank to access the capital markets through the subsidiary.

Management has been advised that as of December 31, 2008 and 2007, the Bank qualified as a “well-capitalized” institution as defined by the Federal Deposit Insurance Corporation Improvement Act of 1991, as amended. On a consolidated basis, the Company also exceeded regulatory capital requirements. In accordance with applicable regulations, the appraised fair value of West Suburban common stock owned by the ESOP is included in Tier 1 capital.

Liquidity

Effective liquidity management ensures the availability of funding sources at minimum cost to meet fluctuating deposit balances, loan demand needs and to take advantage of earnings enhancement opportunities. A large, stable core deposit base and a strong capital position are the solid foundation for the Company’s liquidity position. Liquidity is enhanced by a securities portfolio structured to provide liquidity as needed. The Company also maintains relationships with correspondent banks to purchase federal funds subject to underwriting and collateral requirements. Additionally, subject to credit underwriting, collateral, capital stock, and other requirements of the Federal Home Loan Bank of Chicago (the “FHLB”), the Company is able to borrow from the FHLB on a “same day” basis. As of December 31, 2008, the Company could have borrowed up to approximately $123 million from the FHLB secured by certain of its real estate loans and securities. Furthermore, the Company has agreements in

44

place to borrow up to $100 million in federal funds. The Company manages its liquidity position through continuous monitoring of profitability trends, asset quality, interest rate sensitivity and maturity schedules of interest-earning assets and interest-bearing liabilities.

Generally, the Company uses cash and cash equivalents and securities available for sale to meet its liquidity needs. As of December 31, 2008 and 2007, these liquid assets represented 15.1% and 26.6% of total assets, respectively. The decrease in liquidity was primarily due to the maturities and sales of U.S. government sponsored agency obligations available for sale as well as classifying purchases of new mortgage backed securities as held to maturity. A more detailed discussion of this activity can be found in the Securities discussion of the Balance Sheet Analysis section of this report.

During 2008, the Company’s cash and cash equivalents increased $22.3 million. Net cash provided by operating activities for this period was $25.4 million, while net cash used in investing activities was $8.0 million. Net cash flows provided by financing activities for this period were $4.9 million.

Income Statement Analysis — 2008 Compared to 2007

General. The Company’s net income decreased 28.2% in 2008 as compared to 2007. Net income was positively affected by an increase in net interest income of $.8 million, an increase in total noninterest income of $1.6 million and a decrease in income tax expense of $3.7 million. Net income was negatively affected by an increase in the provision for loan loss of $10.0 million and an increase in total noninterest expense of $2.8 million.

Net Interest Income. Net interest income in 2008 (on a fully tax-equivalent basis) increased 1.8% compared to 2007. Net interest income is the primary source of income for the Company. Net interest income is the difference between interest income earned on interest-earning assets and interest expense incurred on interest-bearing liabilities. Net interest income is affected by changes in volume and yield on interest-earning assets and the volume and rates on interest-bearing liabilities. Interest-earning assets consist of federal funds sold, securities and loans. Interest-bearing liabilities primarily consist of deposits and federal funds purchased. The net interest margin is the percentage of tax-equivalent net interest income to average earning assets. The Company’s net interest margin (on a fully tax-equivalent basis) was 3.6% in 2008 and 3.5% in 2007.

Total interest income (on a tax-equivalent basis) decreased 12.0% in 2008 primarily due to decreasing yields in the Company’s loan portfolio. Average loan balances increased 3.9% during this period. The yield on the Company’s home equity loan portfolio decreased 98 basis points during this period primarily due to decreases in the interest rate charged for home equity lines of credit that adjusted as a result of decreases in the prime rate. These decreases were a direct result of the Federal Reserve initiating interest rate reductions of 400 basis points in 2008 and 100 basis points during the last six months of 2007. The average prime rate was 5.08% for 2008 and 8.05% for 2007. Yields on the Company’s commercial loan portfolio decreased 259 basis points during this period. This decrease was partially due to the majority of adjustable rate commercial loans being tied to the prime rate, as well as a $21.3 million increase in nonaccrual loans during 2008, which accounted for $1.3 million of lost interest and a reduction in yield of 30 basis points. Yields on federal funds sold decreased 274 basis points due to decreases in interest rates initiated by the Federal Reserve. Yields on investment securities increased 40 basis points due to proceeds from maturities and sales of securities issued by U.S. government sponsored entities being invested in higher yielding mortgage-backed securities issued by U.S. government sponsored entities.

Total interest expense decreased 29.5% in 2008. Interest on deposits accounted for the decrease, which was only partially offset by an increase in interest expense on federal funds purchased. The yield on interest-bearing deposits decreased 93 basis points to 2.25% in 2008 from 3.18% in 2007. Approximately 58% of the Company’s certificates of deposit are scheduled to mature in 2009, which will reduce the cost of funds as management expects that the certificates of deposit will be either renewed at a substantially lower rate or replaced with lower costing alternative funding sources.

45

The following table reflects the impact of changes in volume and rates of interest-earning assets and interest-bearing liabilities on a tax equivalent basis for the years ended December 31, 2008 and 2007 (dollars in thousands):

	2008 compared to 2007									2007 compared to 2006
	Change due to						Total			Change due to						Total
	Volume			Rate			Change			Volume			Rate			Change
Interest Income
Federal funds sold	$	(1,263	)	$	(1,600	)	$	(2,863	)	$	3		$	126		$	129
Securities	11			1,990			2,001			(1,397		)	1,492			95
Loans	2,712			(14,977		)	(12,265		)	3,545			(938		)	2,607
Total interest income	1,460			(14,587		)	(13,127		)	2,151			680			2,831
Interest Expense
Interest-bearing deposits	(715		)	(14,180		)	(14,895		)	382			2,518			2,900
Other interest-bearing liabilities	661			—			661			(14		)	(14		)	(28		)
Total interest expense	(54		)	(14,180		)	(14,234		)	368			2,504			2,872
Net interest income	$	1,514		$	(407	)	$	1,107		$	1,783		$	(1,824	)	$	(41	)

Provision for Loan Losses. The provision for loan losses increased $10.0 million in 2008. The Company determined that additional loan loss provisions were necessary due to the increased levels of charge-offs and nonperforming loans, an increase in loan loss reserves allocated to specific impaired loans and downward trends in the national and local economies. A more detailed discussion concerning the allowance for loan losses is presented in the Allowance for Loan Losses and Asset Quality section of this annual report.

Noninterest Income. Total noninterest income increased 5.9% during 2008 compared to 2007. Prepaid solutions cards income increased $2.8 million, primarily due to continued growth in two existing programs. BOLI income decreased $3.7 million, primarily due to the decline in the market value of the underlying investments associated with the insurance policies that are tied to the Company’s deferred compensation plans. During 2008, the Company recorded a gain of $1.1 million on the mandatory partial redemption of VISA stock in connection with the VISA public offering. A portion of the VISA stock allocated to the Company in the initial public offering was withheld to cover the costs and expenses associated with various lawsuits for which the Company, as a member of the VISA network, is obligated to indemnify VISA. As a result, the Company also recorded $.8 million of income related to the recovery of expenses recorded in the fourth quarter of 2007 and $.2 million in recovery of expenses recorded during the third quarter of 2008 in connection with the creation of litigation reserves relating to these lawsuits.

Noninterest Expense. Total noninterest expense increased 5.0% during 2008 compared to 2007. Salaries and employee benefits decreased $2.3 million primarily due to a decline in the market value of the underlying investments associated with the insurance policies that are tied to the Company’s deferred compensation plans. Excluding this decline, salaries and employee benefits increased $.8 million. Additionally, the Company experienced increased employee insurance expense. Prepaid solutions cards expense increased $2.4 million. This increase was primarily due to expenses associated with the production and processing of cards and postage associated with the issuance of new cards. Furniture and equipment expense increased $.8 million, primarily due to increased equipment depreciation and data processing expense. Occupancy expense increased $.7 million, primarily due to costs associated with increased maintenance and utilities expense. Advertising and promotion expense decreased $.2 million primarily due to reduced costs associated with home equity and commercial loan advertising. Professional fees expense increased $.6 million primarily due to increased legal expenses incurred by the prepaid solutions group. Other noninterest expense increased $.7 million primarily due to expenses relating to litigation settlements associated with the prepaid solutions division.

Income Taxes. Income tax expense decreased 43.5% in 2008, primarily due to lower pre-tax income. The effective tax rates for the years ended December 31, 2008 and 2007 were 22.2% and 26.6%, respectively. This decrease was primarily due to changes in the State of Illinois tax laws discussed in Note 6 to the Company’s financial statements. As a result of the changes in the State of Illinois tax laws, the Company expects the effective tax rates to be higher in future years.

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Income Statement Analysis — 2007 Compared to 2006

General. The Company’s net income decreased 7.6% in 2007 as compared to 2006. Net income was positively affected by an increase in noninterest income of $4.2 million and a decrease in income tax expense of $1.4 million. Net income was negatively affected by an increase in the provision for loan losses of $.2 million and an increase in total noninterest expense of $7.2 million.

Net Interest Income. Net interest income in 2007 (on a fully tax-equivalent basis) was level compared to 2006. Net interest income is the primary source of income for the Company. The Company’s net interest margin (on a fully tax-equivalent basis) was 3.5% in 2007 and 2006.

Total interest income (on a tax-equivalent basis) increased 2.7% in 2007 primarily due to increasing balances in the Company’s loan portfolio. Average loan balances increased 4.3% during this period. Additionally, the yield on the loan portfolio decreased 8 basis points primarily due to interest rate reductions initiated by the Federal Reserve beginning in the third quarter of 2007. Management anticipates further declines in the loan portfolio yield as the Federal Reserve cut rates by 125 basis points in January 2008. The average prime rate was 8.05% for 2007 and 7.96% for 2006. However, the average prime rate for the fourth quarter of 2007 was 7.53% compared to 8.25% for the fourth quarter of 2006. Yields on the commercial loan portfolio decreased 13 basis points during this period due to decreased balances along with decreasing rates as described above. Yields on investment securities increased 28 basis points due to proceeds from maturities of U.S. government securities being reinvested in higher yielding mortgage-backed securities.

Total interest expense increased 6.3% in 2007. Interest on deposits accounted for all of this increase. The yield on interest-bearing deposits increased 17 basis points to 3.18% in 2007 from 3.01% in 2006. This increase was primarily due to increasing yields and balances on the Company’s certificates of deposit portfolio. Approximately 78% of the Company’s certificates of deposit are scheduled to mature in 2008, which management expects will lead to reductions in cost of funds, as proceeds are reinvested at a lower rate or run-off.

Provision for Loan Losses. The provision for loans losses increased $.2 million in 2007. This was primarily related to the current environmental factors in the economy and due to an increase of $71.3 million in total loans, partially offset by the reduction in specific reserves allocated to impaired loans as of December 31, 2007. The increase in total loans was primarily due to lower risk residential and home equity loans. A more detailed discussion concerning the allowance for loans losses is presented in the Allowance for Loan Losses and Asset Quality section of this annual report.

Noninterest Income. Total noninterest income increased 18.4% during 2007 compared to 2006. Prepaid solutions cards income increased $5.1 million primarily due to continued growth in existing programs along with the addition of new gift card programs. Service fees on deposit accounts decreased $.5 million primarily due to decreases in fee revenue related to the Company’s overdraft honors program. Although management believes the income from the overdraft honors program may vary from period to period, the program is intended to provide continuing fee income. Debit card income increased $.1 million due to increased customer usage. During the fourth quarter of 2007, the Company recorded a loss of $.4 million after making the determination that the decrease in market value of FHLMC preferred stock represented other-than-temporary impairment.

Noninterest Expense. Total noninterest expense increased 15.0% during 2007 compared to 2006. Salaries and employee benefits increased $.2 million primarily due to normal salary increases and increased medical insurance expense. This increase was partially offset by a reduction in contributions to the Company’s retirement plans as a result of the Company’s transition from the ESOP to the 401(k) Plan as the Company’s principal retirement plan. Prepaid solutions cards expense increased $3.9 million. This increase was due to expenses associated with the production and processing of cards and postage associated with the issuance of new cards along with increased revenue sharing with one new client. The Company anticipates that this expense will continue to increase as new programs continue to be implemented. Furniture and equipment expense increased $.8 million primarily due to increased equipment depreciation and maintenance along with increased data processing expense. Occupancy expense decreased $.1 million in 2007 primarily due to the acceleration of building depreciation expense that occurred in 2006 resulting from management’s decision to close the Metra Main facility. This decrease was partially offset by increases in utilities expense and building maintenance costs. Advertising and promotion expense

47

increased $.4 million primarily due to expenses resulting from newspaper, television and billboard marketing campaigns associated with retail banking as well as commercial and mortgage loans. Professional fees expense increased $.5 million primarily due to costs associated with the prepaid solutions cards business. Other expense increased $1.5 million primarily due to the Company establishing litigation reserves in connection with various lawsuits brought against Visa USA Inc. along with increased Visa cardholder expense. The Company, as a member of the Visa network, is obligated to indemnify Visa for certain litigation losses. In 2007, the Company recognized indemnity charges of approximately $.8 million related to this obligation. As anticipated, at the time that Visa completed an initial public offering (the “IPO”) of its common stock in 2008, the Company recognized gains on its interest in Visa which more than exceeded the charges taken in 2007.

Income Taxes. Income tax expense decreased 14.2% in 2007, primarily due to lower pre-tax income. The effective tax rates for the years ended December 31, 2007 and 2006 were 26.6% and 28.1%, respectively.

In August 2007, the State of Illinois enacted legislation that will affect the tax obligations of banks operating in Illinois. The legislative provisions have various effective dates, the earliest beginning January 1, 2008. Although the legislation is not expected to have a material adverse impact on the Company’s 2008 state tax liability, the full impact of the legislation is currently unknown. The Company will continue to evaluate this legislation as well as any related legislation or guidance.

Interest Rate Sensitivity

The Company attempts to maintain a conservative posture with regard to interest rate risk by actively managing its asset/liability GAP position and monitoring the direction and magnitude of gaps and risk. The Company attempts to moderate the effects of changes in interest rates by adjusting its asset and liability mix to achieve desired relationships between rate sensitive assets and rate sensitive liabilities. Rate sensitive assets and liabilities are those instruments that reprice within a given time period. An asset or liability reprices when its interest rate is subject to change or upon maturity.

Movements in general market interest rates are a key element in changes in the net interest margin. The Company’s policy is to manage its balance sheet so that fluctuations in the net interest margin are minimized regardless of the level of interest rates, although the net interest margin does vary somewhat due to management’s response to increasing competition from other financial institutions.

The Company measures interest rate sensitivity through a net interest income analysis. The net interest income analysis measures the change in net interest income in the event of hypothetical changes in interest rates. This analysis assesses the risk of changes in net interest income in the event of a sudden and sustained 100 to 200 basis point increase or decrease in market interest rates. This analysis is subject to the Company’s assumptions, which include the following:

·Balance sheet volume reflects the current balances and does not project future growth or changes. The current balances establish the base case from which all percent changes are calculated.

·The replacement rate for loan and deposit items that mature is the current rate offered by the Company as adjusted for the assumed rate increase or decrease. The replacement rate for securities is the current market rate as adjusted for the assumed rate increase or decrease.

·The repricing rate for balance sheet data is determined by utilizing individual account statistics provided by the Company’s data processing systems.

·The maturity and repricing dates for balance sheet data are determined by utilizing individual account statistics provided by the Company’s data processing systems.

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Listed below are the Company’s projected changes in net interest income over a twelve-month horizon for the various rate shock levels as of the periods indicated (dollars in thousands):

	Amount		Dollar Change			Percent Change
December 31, 2008
+200 basis points	$	59,584	$	1,772		3.1	%
+100 basis points	58,976		1,164			2.0	%
Base	57,812
-100 basis points	52,497		(5,315		)	(9.2	)%
-200 basis points	46,324		(11,488		)	(19.9	)%
December 31, 2007
+200 basis points	$	63,598	$	996		1.6	%
+100 basis points	63,310		708			1.1	%
Base	62,602
-100 basis points	62,349		(253		)	(0.4	)%
-200 basis points	57,728		(4,874		)	(7.8	)%

Effects of Inflation

Unlike industrial companies, nearly all of the assets and liabilities of the Company are monetary in nature. As a result, interest rates have a more significant impact on the Company’s performance than do the effect of general levels of inflation. Interest rates do not necessarily move in the same direction or experience the same magnitude of change as goods and services, since such prices are affected by inflation. In the current economic environment, liquidity and interest rate adjustments are features of the Company’s asset/liability management, which are important to the maintenance of acceptable performance levels. The Company attempts to maintain a balance between monetary assets and monetary liabilities, over time, to offset the potential effects of changing interest rates.

Recent Regulatory Issues

On December 3, 2008, the Bank entered into an Order to Cease and Desist (the “Order”) with the FDIC and the Illinois Department of Financial and Professional Regulation (the “DFPR”), which is based on FDIC and DFPR findings that the Bank’s Secrecy Act/Anti-Money Laundering Program (“BSA/AML Program”) was inadequate and that the Bank had violated various laws and regulations related to the Bank Secrecy Act (the “BSA”). The Order requires the Bank to take certain corrective actions aimed at resolving any outstanding violations of BSA-related laws or regulations and to implement a revised BSA/AML Program, which is designed to ensure compliance with these BSA-related laws and regulations. The Order also requires the Bank to, among other things, assess its BSA Department staffing needs, provide for independent testing of BSA/AML Program compliance, conduct a review of certain historical deposit and transaction activity and submit periodic reports of progress to the FDIC and DFPR. The Order does not relate to the Bank’s asset quality, capital position or the safety and soundness of its financial operations. The Bank expects the Order to increase the Bank’s cost of regulatory compliance, which may adversely affect its earnings.

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BOARDS OF DIRECTORS

West Suburban Bancorp, Inc.

Kevin J. Acker	Chairman of the Board
David S. Bell	Certified Public Accountant
Duane G. Debs	President and Chief Financial Officer
Charles P. Howard	Parkview Community Church, Associate Pastor
Peggy P. LoCicero	Former Banker

West Suburban Bank

Robert W. Schulz	Chairman
Keith W. Acker	President
Craig R. Acker	Former Banker
Earl K. Harbaugh	Ditch Witch Midwest, President
Ronald J. Kuhn	Harry W. Kuhn, Inc., Chairman, Secretary and Treasurer
John G. Williams	Bracing Systems, Vice President

OFFICERS

West Suburban Bancorp, Inc.

Kevin J. Acker	Chief Executive Officer
Duane G. Debs	President and Chief Financial Officer
Keith W. Acker	Chief Operations Officer
Michael P. Brosnahan	Vice President
Timothy W. Clifford	Internal Audit Manager
George E. Ranstead	Secretary to the Board and Treasurer

West Suburban Bank

Senior Officers
Keith W. Acker	President, Trust Officer
Kevin J. Acker	Senior Vice President, Marketing
Michael P. Brosnahan	Senior Vice President, Lending
Duane G. Debs	Senior Vice President, Comptroller and Trust Officer
Daniel P. Grotto	Senior Vice President, Prepaid Solutions
Bank Secrecy/Anti-Money Laundering
Gina Lowdermilk	Vice President, Bank Secrecy Act Officer
Building Management
Edward J. Garvey	Vice President, Building Management

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Cash Management
Gary Raczek	Vice President, Cash Management Manager
Commercial Loans
Stanley C. Celner, Jr.	Vice President, Commercial Loans
Grant O. Cowen	Vice President, Commercial Loans
Timothy P. Dineen	Vice President, Commercial Real Estate Loans
Michael F. Moone	Vice President, Commercial Real Estate Loans
David S. Orr	Vice President, Commercial Loans
John J. Schroeder	Vice President, Commercial Loans
Edwin S. Stephens IV	Vice President, Commercial Loans
Gregory L. Young	Vice President, Commercial Loans
Matthew R. Acker	Business Development
Compliance
Cyndia S. Heap	Compliance Officer, Community Reinvestment Act Officer
Comptroller
George E. Ranstead	Vice President, Assistant Comptroller and Investment Officer
Jay J.P. Greifenkamp	Vice President, Financial Analyst, Investment Officer and Secretary to the Board
Consumer Loans
Charles J. Svoboda	Vice President, Consumer Loans - Department Head
Cynthia A. Meredith	Vice President, Consumer Loans
David J. Wanek	Vice President, Consumer Loans
Corporate Operations
Danielle Budig	Vice President, Corporate Operations and Visa
Michael J. Lynch	Vice President, Corporate Operations
Financial Services
Michael Abbatacola	Vice President, Financial Services
Human Resources
Mary Ellen Condon	Vice President, Human Resources
Information Systems
Steven A. Jennrich	Vice President, Information Systems
Jacqueline R. Weigand	Vice President, Project Manager
Internal Audit
Timothy W. Clifford	Vice President, Internal Audit Manager
Loan Operations
Sandra C. Boyce	Vice President, Residential Mortgage Loan Processing
Gary H. Brandes	Vice President, Consumer Loan Operations
Kevin Bussey	Vice President, Collections
Debra H. Crowley	Vice President, Commercial Loan Operations
Lawrence J. Ortman	Vice President, Credit Analysis and Loan Review
Marketing
Denise M. Zatarski	Director of Marketing
Prepaid Solutions
Doug R. Bobenhouse	Business Development and Sales Manager - Prepaid Solutions

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Purchasing
Helen G. Schmitt	Assistant Vice President, Purchasing Manager
Retail Banking
William J. Jennrich	Vice President, Retail Branch Banking
Jack Buscemi	Vice President, Regional Manager - Central Region
Marc L. DiNatale	Vice President, Regional Manager - East Region
Kirsten L. Erickson	Vice President, Regional Manager - West Region
Marcia K. Worobec	Vice President, Branch Operations and Branch Manager - Westmore
Jennifer Bentson	Assistant Vice President, Branch Manager - Warrenville
Kathleen M. Brockman	Assistant Vice President, Branch Manager - Eola Road
Jeanne L. Carlisle	Assistant Vice President, Branch Manager - Bolingbrook West
Maribel Colon	Assistant Vice President, Branch Manager - Oswego West
Beverly D. Cornelious	Assistant Vice President, Branch Manager - Bolingbrook East
Gina M. Corral	Assistant Vice President, Branch Manager - President Street
Barbara D. Darden	Assistant Vice President, Branch Manager - Chicago Avenue, Naperville
Robert G. Dover, Jr.	Assistant Vice President, Branch Manager - Gary Avenue
Nansi E. Eivaz	Assistant Vice President, Branch Manager - Romeoville
Sharon A. Fonte	Assistant Vice President, Branch Manager - Glendale Heights
James R. Graziano	Assistant Vice President, Branch Manager - North Main
Cheli Harper	Assistant Vice President, Branch Manager - Charlestown
Priya Hira	Assistant Vice President, Branch Manager - Danada, Wheaton
Rosemary Kasal	Assistant Vice President, Branch Manager - Bartlett
Jason M. Knapp	Assistant Vice President, Branch Manager - Fair Oaks
Mary L. Kureja	Assistant Vice President, Branch Manager - Finley Road, Downtown Downers
Terry Leitner	Assistant Vice President, Branch Manager - South Main
Jeffery W. Miska	Assistant Vice President, Branch Manager - Cass Avenue, 75th Street
Carlos Muzquiz	Assistant Vice President, Branch Manager - Lake Street
Brian S. Nickleski	Assistant Vice President, Branch Manager - Westmont
Gwen B. O’Loughlin	Assistant Vice President, Branch Manager - Villa Park
Robert L. Pauling	Assistant Vice President, Branch Manager - Stratford Square
Cynthia A. Picton	Assistant Vice President, Branch Manager - West Galena
Laura Saad	Assistant Vice President, Branch Manager - Yorkville, Oswego
Lisa M. Schmidt	Assistant Vice President, Branch Manager - South Elgin
Patience K. Tannenbaum	Assistant Vice President, Branch Manager - Randall Road
Mihaela Tonchevici	Assistant Vice President, Branch Manager - Montgomery
Jill E. Castillo	Manager Trainee - Oakbrook Terrace
Trust
Christine H. Pawlak	Trust Officer
West Suburban Insurance Services
Patricia Falstrom	Insurance Agent

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ADDRESSES OF WEST SUBURBAN FACILITIES

(630) 652 - 2000

Aurora

Eola Road Branch: 335 North Eola Road, Aurora, Illinois 60504

Galena Branch: 2000 West Galena Boulevard, Aurora, Illinois 60506

Lake Street Branch: 101 North Lake Street, Aurora, Illinois 60506

Bartlett

Bartlett Branch: 1061 West Stearns Road, Bartlett, Illinois 60103

Bloomingdale

Stratford Square Branch: 355 West Army Trail Road, Bloomingdale, Illinois 60108

Bolingbrook

Bolingbrook East Branch: 672 East Boughton Road, Bolingbrook, Illinois 60440

Bolingbrook West Branch: 1104 West Boughton Road, Bolingbrook, Illinois 60440

Carol Stream

Gary Avenue Branch: 401 North Gary Avenue, Carol Stream, Illinois 60188

Fair Oaks Branch: 1380 West Army Trail Road, Carol Stream, Illinois 60188

President Street Branch: 895 East Geneva Road, Carol Stream, Illinois 60188

Darien

75th Street Branch: 1005 75th Street, Darien, Illinois 60561

Cass Avenue Branch: 8001 South Cass Avenue, Darien, Illinois 60561

Downers Grove

Downtown Downers Branch: 5330 Main Street, Downers Grove, Illinois 60515

Finley Road Branch: 2800 Finley Road, Downers Grove, Illinois 60515

Glendale Heights

Glendale Heights Branch: 1657 Bloomingdale Road, Glendale Heights, Illinois 60139

Lombard

North Main Branch: 707 North Main Street, Lombard, Illinois 60148

South Main Branch: 1122 South Main Street, Lombard, Illinois 60148

Westmore Branch: 711 South Meyers Road, Lombard, Illinois 60148 (Headquarters)

Montgomery

Montgomery Branch: 1830 Douglas Road, Montgomery, Illinois 60538

Naperville

Chicago Avenue Branch: 1296 East Chicago Avenue, Naperville, Illinois 60540

Naperville Branch: 2020 Feldott Lane, Naperville, Illinois 60540

River Run Branch: 1004 104th Street, Naperville, IL 60564

Oakbrook Terrace

Oakbrook Terrace Branch: 17W754 22nd Street, Oakbrook Terrace, Illinois 60181

Oswego

Oswego Branch: 2830 Route 34, Oswego, Illinois 60543

Oswego West Branch: 1071 Station Drive, Oswego, Illinois 60543

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Romeoville

Romeoville Branch: 505 North Weber Road, Romeoville, Illinois 60446

South Elgin

South Elgin Branch: 1870 McDonald Road, South Elgin, Illinois 60177

St. Charles

Charlestowne Branch: 3000 East Main Street, St. Charles, Illinois 60174

St. Charles Branch: 315 South Randall Road, St. Charles, Illinois 60174

Villa Park

Villa Park Branch: 40 East St. Charles Road, Villa Park, Illinois 60181

Warrenville

Warrenville Branch: 3S041 Route 59, Warrenville, Illinois 60555

Westmont

Westmont Branch: 6400 South Cass Avenue, Westmont, Illinois 60559

Wheaton

Danada Branch: 295 West Loop Road, Wheaton, Illinois 60187

Wheaton Branch: 221 South West Street, Wheaton, Illinois 60187

Yorkville

Yorkville Branch: 10 Saravanos Drive, Yorkville, Illinois 60560

ATMs are available at all of the above banking branches.

Limited-Service Branches

Beacon Hill Retirement Community: Lombard, Illinois 60148

Clare Oaks: Bartlett, Illinois 60103

Financial Center: 717 South Meyers Road, Lombard, Illinois 60148

Lexington Health Care Center of Elmhurst: Elmhurst, Illinois 60126

Lexington Health Care Center of Lombard: Lombard, Illinois 60148

Other Services

Prepaid Solutions Group: 8001 South Cass Avenue, Darien, Illinois 60561 - (630) 652-2000

West Suburban Bank Land Trust: 711 South Meyers Road, Lombard, Illinois 60148 - (630) 652-2225

West Suburban Bank Visa: 701 South Meyers Road, Lombard, Illinois 60148 - (630) 652-2000 extension 2903

West Suburban Financial Services: 711 South Meyers Road, Lombard, Illinois 60148 - (630) 652-2232

West Suburban Insurance Services, Inc.: 711 South Meyers Road, Lombard, Illinois 60148 - (630) 652-2550

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[MAP OF MARKET AREA THAT INDICATES LOCATION OF FACILITIES]

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Unlike Any Other Bank

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SHAREHOLDER INFORMATION

Annual Report on Form 10-K

A copy of West Suburban Bancorp, Inc.’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission, is available on their web site at www.sec.gov or without charge to shareholders by writing to:

Duane G. Debs

President and Chief Financial Officer

West Suburban Bancorp, Inc.

2800 Finley Road

Downers Grove, Illinois 60515

(630) 652-2801

Annual Meeting of Shareholders

The annual meeting of shareholders of West Suburban Bancorp, Inc. will be held at West Suburban Bank, 711 South Meyers Road, Lombard, Illinois on Wednesday, May 13, 2009 at 8:00 a.m. All shareholders are cordially invited to attend.

Stock Transfer Agent and Registrar

Inquiries regarding stock transfers, registration, lost certificates and changes of name and address should be directed to the stock transfer agent and registrar by writing to:

George E. Ranstead

Secretary to the Board and Treasurer

West Suburban Bancorp, Inc.

2800 Finley Road

Downers Grove, Illinois 60515

(630) 652-2802

Community Reinvestment Act

West Suburban Bank adheres to a well-established policy of helping to meet the credit needs of our local communities, consistent with safe and sound lending practices, in accordance with the Community Reinvestment Act. For additional information, contact:

Cyndia S. Heap

West Suburban Bank

711 South Meyers Road

Lombard, Illinois 60148

(630) 652-2611

Independent Registered Public Accounting Firm

Crowe Horwath LLP

One Mid America Plaza, Suite 700

Post Office Box 3697

Oak Brook, Illinois 60522

Corporate Counsel

Barack Ferrazzano Kirschbaum & Nagelberg LLP

200 West Madison Street, Suite 3900

Chicago, Illinois 60606

MEMBER FDIC

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EX-21

Exhibit 21

SUBSIDIARIES OF REGISTRANT

Subsidiary	State of Organization
West Suburban Bank	Illinois
West Suburban Insurance Services, Inc.	Illinois
Melrose Holdings, Inc.	Illinois
West Suburban Management, LLC	Delaware
West Suburban Realty, LLC	Delaware

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Kevin J. Acker, certify that:

1)I have reviewed this annual report on Form 10-K of West Suburban Bancorp, Inc.;

2)Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3)Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4)The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this annual report based on such evaluation; and

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5)The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 11, 2009

/s/ Kevin J. Acker

Kevin J. Acker

Chairman and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Duane G. Debs, certify that:

1)I have reviewed this annual report on Form 10-K of West Suburban Bancorp, Inc.;

2)Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3)Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4)The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this annual report based on such evaluation; and

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5)The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 11, 2009

/s/ Duane G. Debs

Duane G. Debs

President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of West Suburban Bancorp, Inc. (the “Company”) on Form 10-K for the period ending December 31, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Kevin J. Acker, Chairman and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Kevin J. Acker

Kevin J. Acker

Chairman and Chief Executive Officer

March 11, 2009

A signed original of this written statement required by Section 906 has been provided to West Suburban Bancorp, Inc. and will be retained by West Suburban Bancorp, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of West Suburban Bancorp, Inc. (the “Company”) on Form 10-K for the period ending December 31, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Duane G. Debs, President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Duane G. Debs

Duane G. Debs

President and Chief Financial Officer

March 11, 2009

A signed original of this written statement required by Section 906 has been provided to West Suburban Bancorp, Inc. and will be retained by West Suburban Bancorp, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.