Restricted Stock Unit Award Agreement

Home Federal Savings and Loan Association Restricted Stock Plan and Trust Agreement

July 1998     §18.209

Exhibit B

Home Federal Savings and Loan Association
Restricted Stock Plan
and Trust Agreement

Article I

ESTABLISHMENT OF THE PLAN AND TRUST

1.01 Home Federal Savings and Loan Association ("Savings Association") hereby establishes the Restricted Stock Plan (the "Plan") and Trust (the "Trust") upon the terms and conditions hereinafter stated in this Restricted Stock Plan and Trust Agreement (the "Agreement").

1.02 The Trustee hereby accepts this Trust and agrees to hold the Trust assets existing on the date of this Agreement and all additions and accretions thereto upon the terms and conditions hereinafter stated.

Article II

PURPOSE OF THE PLAN

2.01 The purpose of the Plan is to reward and to retain personnel of experience and ability in key positions of responsibility with the Savings Association and its subsidiaries, by providing such personnel of the Savings Association and its subsidiaries with an equity interest in the parent corporation of the Savings Association, Green Street Financial Corp ("Parent"), as compensation for their prior and anticipated future professional contributions and service to the Savings Association and its subsidiaries.

Article III

DEFINITIONS

The following words and phrases when used in this Plan with an initial capital letter, unless the context clearly indicates otherwise, shall have the meaning as set forth below. Wherever appropriate, the masculine pronoun shall include the feminine pronoun and the singular shall include the plural.

3.01 "Beneficiary" means the person or persons designated by the Participant to receive any benefits payable under the Plan in the event of such Participant's death.

Such person or persons shall be designated in writing on forms provided for this purpose by the Committee and may be changed from time to time by similar written notice to the Committee.

In the absence of a written designation, the Beneficiary shall be the Participant's surviving spouse, if any, or if none, the Participant's estate.

3.02 "Board" means the Board of Directors of the Savings Association, or any successor corporation thereto.

3.03 "Cause" means the personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profits, intentional failure to perform stated duties, willful violation of a material provision of any law, rule or regulation (other than traffic violations and similar offense), or a material violation of a final cease-and-desist order or any other action which results in a substantial financial loss to the Parent, Savings Association or its Subsidiaries.

3.04 "Change in Control" shall mean: (i) the sale of all, or a material portion, of the assets of the Parent or Savings Association; (ii) the merger or recapitalization of the Parent or the Savings Association whereby the Parent or Savings Association is not the surviving entity; (iii) a change in control of the Parent or Savings Association, as otherwise defined or determined by the Office of Thrift Supervision ("OTS") or regulations promulgated by it; or (iv) the acquisition, directly or indirectly, of the beneficial ownership of twenty-five percent (25%) or more of the outstanding voting securities of the Parent or Savings Association by any person, trust, entity or group.

3.05 "Committee" means the Board of Directors of the Parent or the Restricted Stock Plan Committee appointed by the Board of Directors of the Parent pursuant to Article IV hereof.

3.06 "Common Stock" means shares of the common stock of the Savings Association or any successor corporation or Parent thereto.

3.07 "Conversion" means the effective date of the stock charter of the Savings Association and simultaneous acquisition of all of the outstanding stock of the Savings Association by the Parent.

3.08 "Director" means a member of the Board of the Savings Association.

3.09 "Director Emeritus" means a person serving as a director emeritus or other similar position as may be appointed by the Board of Directors of the Savings Association or the Parent from time to time.

3.10 "Disability" means any physical or mental impairment which renders the Participant incapable of continuing in the employment or service of the Savings Association or the Parent in his current capacity as determined by the Committee.

3.11 "Employee" means any person who is employed by the Savings Association or a Subsidiary.

3.12 "Effective Date" shall mean the date of stockholder approval of the Plan by the Parent's stockholders.

3.13 "Parent" shall mean Green Street Financial Corp, the parent corporation of the Savings Association.

3.14 "Participant" means an Employee or Director who receives a Plan Share Award under the Plan.

3.15 "Plan Shares" means shares of Common Stock held in the Trust which are awarded or issuable to a Participant pursuant to the Plan.

3.16 "Plan Share Award" or "Award" means a right granted to a Participant under this Plan to earn or to receive Plan Shares.

3.17 "Plan Share Reserve" means the shares of Common Stock held by the Trust pursuant to Sections 5.03 and 5.04.

3.18 "Savings Association" means Home Federal Savings and Loan Association, and any successor corporation thereto.

3.19 "Subsidiary" means those subsidiaries of the Savings Association which, with the consent of the Board, agree to participate in this Plan.

3.20 "Trustee" or "Trustee Committee" means that person(s) or entity nominated by the Committee and approved by the Board pursuant to Sections 4.01 and 4.02 to hold legal title to the Plan assets for the purposes set forth herein.

Article IV

ADMINISTRATION OF THE PLAN

4.01 Role of the Committee. The Plan shall be administered and interpreted by the Board of Directors of the Parent or a Committee appointed by said Board, which shall consist of not less than two non-employee members of the Board, which shall have all of the powers allocated to it in this and other sections of the Plan.

4.02 Role of the Board. The members of the Committee and the Trustee shall be appointed or approved by, and will serve at the pleasure of the Board.

4.03 Limitation on Liability. No member of the Board, the Committee or the Trustee shall be liable for any determination made in good faith with respect to the Plan or any Plan Share Awards granted.

Article V

CONTRIBUTIONS; PLAN SHARE RESERVE

5.01 Amount and Timing of Contributions. The Board of Directors of the Savings Association shall determine the amounts (or the method of computing the amounts) to be contributed by the Savings Association to the Trust established under this Plan.

5.02 Initial Investment. Any funds held by the Trust prior to investment in the Common Stock shall be invested by the Trustee in such interest-bearing account or accounts at the Savings Association as the Trustee shall determine to be appropriate.

5.03 Investment of Trust Assets. Following approval of the Plan by stockholders of the Parent and receipt of any other necessary regulatory approvals, the Trust shall purchase Common Stock of the Parent in an amount equal to up to 100% of the Trust's assets.

5.04 Effect of Allocations, Returns and Forfeitures Upon Plan Share Reserves. Upon the allocation of Plan Share Awards under Sections 6.02 and 6.05, or the decision of the Committee to return Plan Shares to the Parent, the Plan Share Reserve shall be reduced by the number of Shares subject to the Awards so allocated or returned.

Article VI

ELIGIBILITY; ALLOCATIONS

6.01 Eligibility. Employees are eligible to receive Plan Share Awards within the sole discretion of the Committee.

6.02 Allocations. The Committee will determine which of the Employees will be granted Plan Share Awards and the number of Shares covered by each Award.

6.03 Form of Allocation. As promptly as practicable after a determination is made that a Plan Share Award is to be made, the Committee shall notify the Participant in writing of the grant of the Award, the number of Plan Shares covered by the Award, and the terms upon which the Plan Shares subject to the award may be earned.

6.04 Allocations Not Required. No Employee shall have any right or entitlement to receive a Plan Share Award hereunder, such Awards being at the sole discretion of the Committee and the Board.

6.05 Awards to Directors. Upon the Effective Date, a Plan Share Award consisting of 8,596 Plan Shares shall be awarded to each Director of the Savings Association that is not otherwise an Employee.

Article VII

EARNINGS AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS

7.01 Earnings Plan Shares; Forfeitures.

(a) General Rules. Plan Shares subject to an Award shall be earned and non-forfeitable by a Participant at the rate of one-fifth of such Award following one year after the granting of such Award, and an additional one-fifth following each of the next four successive years.

(b) Revocation for Misconduct. The Board may immediately revoke, rescind and terminate any Plan Share Award in the case of a Participant discharged for Cause.

(c) Exception for Terminations Due to Death or Disability. All Plan Shares subject to a Plan Share Award held by a Participant whose employment or service terminates due to death or Disability shall be deemed earned and nonforfeitable as of the Participant's last date of employment or service.

(d) Exception for Termination after a Change in Control. All Plan Shares subject to a Plan Share Award held by a Participant shall be deemed to be immediately 100% earned and non-forfeitable in the event of a Change in Control of the Parent or Savings Association.

7.02 Accrual and Payment of Dividends. A holder of a Plan Share Award, whether or not earned, shall also be entitled to receive an amount equal to any cash dividends declared and paid with respect to shares of Common Stock represented by such Plan Share Award.

7.03 Distribution of Plan Shares.

(a) Timing of Distributions: General Rule. Except as provided in Subsections (d) and (e) below, Plan Shares shall be distributed to the Participant or his Beneficiary as soon as practicable after they have been earned.

(b) Form of Distribution. All Plan Shares, together with any shares representing stock dividends, shall be distributed in the form of Common Stock.

(c) Withholding. The Trustee may withhold from any payment or distribution made under this Plan sufficient amounts of cash or shares of Common Stock necessary to cover any applicable withholding and employment taxes.

(d) Timing: Exception for 10% Shareholders. No Plan Shares may be distributed prior to the date which is five years from the effective date of the Conversion to the extent the Participant or Beneficiary would after receipt own in excess of ten percent (10%) of the issued and outstanding shares of Common Stock held by parties other than Parent.

(e) Regulatory Exceptions. No Plan Shares shall be distributed unless and until all of the requirements of all applicable law and regulation shall have been fully complied with.

7.04 Voting of Plan Shares. After a Plan Share Award has become earned and non-forfeitable, the Participant shall be entitled to direct the Trustee as to the voting of the Plan Shares which are associated with the Plan Share Award and which have not yet been distributed.

Article VIII

TRUST

8.01 Trust. The Trustee shall receive, hold, administer, invest and make distributions and disbursements from the Trust in accordance with the provisions of the Plan and Trust.

8.02 Management of Trust. The Trustee shall have complete authority and discretion with respect to the management, control and investment of the Trust, and shall invest all assets of the Trust in Common Stock to the fullest extent practicable, except to the extent that the Trustee determines that the holding of monies in cash or cash equivalents is necessary.

(a) To invest up to one hundred percent (100%) of all Trust assets in the Common Stock.

(b) To invest any Trust assets not otherwise invested in deposit accounts, certificates of deposit, obligations of the United States government or its agencies, or other cash equivalents.

(c) To sell, exchange or otherwise dispose of any property at any time held or acquired by the Trust.

(d) To cause stocks, bonds or other securities to be registered in the name of a nominee.

(e) To hold cash without interest in such amounts as may be reasonable for the proper operation of the Plan and Trust.

(f) To employ brokers, agents, custodians, consultants and accountants.

(g) To hire counsel to render advice with respect to their rights, duties and obligations hereunder.

(h) To hold funds and securities representing amounts to be distributed to a Participant or his Beneficiary as a consequence of a dispute.

8.03 Records and Accounts. The Trustee shall maintain accurate and detailed records and accounts of all transactions of the Trust.

8.04 Earnings. All earnings, gains and losses with respect to Trust assets shall be allocated in accordance with a reasonable procedure adopted by the Committee.

8.05 Expenses. All costs and expenses incurred in the operation and administration of this Plan shall be paid by the Savings Association.

8.06 Indemnification. Subject to the requirements and limitations of applicable laws and regulations, the Parent and the Savings Association shall indemnify, defend and hold the Trustee harmless against all claims, expenses and liabilities arising out of or related to the exercise of the Trustee's powers and the discharge of their duties hereunder, unless due to gross negligence or willful misconduct.

Article IX

MISCELLANEOUS

9.01 Adjustments for Capital Changes. The aggregate number of Plan Shares available for issuance pursuant to the Plan Share Awards and the number of Shares to which any Plan Share Award relates shall be proportionately adjusted for any increase or decrease in the total number of outstanding shares of Common Stock issued subsequent to the effective date of the Plan.

9.02 Amendment and Termination of the Plan. The Board may, by resolution, at any time, amend or terminate the Plan.

9.03 Nontransferable. Plan Share Awards and rights to Plan Shares shall not be transferable by a Participant.

9.04 No Employment Rights. Neither the Plan nor any grant of a Plan Share Award or Plan Shares hereunder shall create any right on the part of any Participant to continue in the employ or service of the Parent, Savings Association, or a Subsidiary thereof.

9.05 Voting and Dividend Rights. No Participant shall have any voting or dividend rights of a stockholder with respect to any Plan Shares covered by a Plan Share Award except as expressly provided in Sections 7.02 and 7.04 above.

9.06 Governing Law. The Plan and Trust shall be governed by and construed under the laws of the State of North Carolina, except to the extent that Federal Law shall be deemed applicable.

9.07 Effective Date. The Plan shall be effective as of the date of approval of the Plan by stockholders of the Parent, subject to the receipt of approval or non-objection by the OTS or other applicable banking regulator, if applicable.

9.08 Term of Plan. This Plan shall remain in effect until the earlier of termination by the Board, the distribution of all assets of the Trust, or 21 years from the Effective Date.

9.09 Tax Status of Trust. It is intended that the Trust established hereby shall be treated as a grantor trust of the Savings Association under the provisions of Section 671 et seq. of the Internal Revenue Code of 1986, as amended, as the same may be amended from time to time.

Additional Notes