WARREN BANCORP, INC. 1995 Incentive and Nonqualified Stock Option Plan

ARTICLE I. Purpose. The purpose of this Plan is to advance the interests of Warren Bancorp, Inc. (the “Company”) by strengthening the ability of Bancorp to attract, retain and motivate employees and members of the Board of Directors of Bancorp and certain affiliated corporations by providing them with an opportunity to purchase stock of Bancorp. It is intended that this purpose will be effected by the granting of both incentive stock options (“incentive options”), as described in Section 422(b) of the Internal Revenue Code of 1986, as amended (the “Code”), and nonqualified stock options (“nonqualified options”).

ARTICLE II. Effective Date. This Plan becomes effective on the date on which the Plan is approved by the stockholders of Bancorp. Although options may be granted before such stockholder approval upon condition of such approval, no option may be exercised until such approval is obtained and such options will be null and void if such approval is not obtained.

ARTICLE III.   Stock Subject to the Plan. The aggregate number of shares of $0.10 par value, common stock of Bancorp (the “Shares”) with respect to which options may be granted under this Plan shall not exceed 300,000 Shares, subject to adjustment as provided in Section 9 hereof. Any Shares subject to an option which for any reason expires or is terminated unexercised as to such Shares may again be the subject of an option under the Plan. In addition, any Shares purchased by an optionee upon exercise of an option which are subsequently repurchased by Bancorp pursuant to the terms of such option may again be the subject of an option under the Plan. The Shares delivered upon exercise of options under this Plan may, in whole or in part, be either authorized but unissued Shares or issued Shares reacquired by Bancorp.

ARTICLE IV.   Administration.

(a)   This Plan shall be administered by the Executive Committee of Bancorp, acting for such purposes without any officers or employees of Bancorp, Warren Five Cents Savings Bank (the “Bank”) or any other subsidiary of Bancorp (the “Committee”), which shall consist of not less than three directors of Bancorp. It is the intention of Bancorp that the Plan shall be administered, in accordance with the provisions of Section 4 hereof, in a manner consistent with the provisions of Rule 16b-3(b) (entitled “Disinterested Administrators”) as promulgated under the Securities Exchange Act of 1934, as amended (the “1934 Act”). The Committee shall exercise all powers under this Plan until other action is taken by the Board of Directors. Action by the Committee shall require the affirmative vote of a majority of all its members, and a further vote of the Board of Directors of Bancorp shall be required for the approval of any and all grants of options recommended by the Committee.

(b)   Subject to the terms and conditions of this Plan, the Committee shall have the power:

(i)   to determine from time to time the options to be granted to eligible persons under this Plan, to prescribe the terms and provisions (which need not be identical) of each option granted under this Plan to such persons, and to recommend to the Board of Directors of Bancorp for its approval the grant of options;

(ii)   to construe and interpret this Plan and options granted thereunder and to establish, amend, and revoke rules and regulations for administration of this Plan. In this connection, the Committee may correct any defect or supply any omission, or reconcile any inconsistency in this Plan, or in any option agreement, in the manner and to the extent it shall deem necessary or expedient to make this Plan fully effective. All decisions and determinations by the Committee and, with respect to the grant of options, by the Board of Directors of Bancorp in the exercise of this power shall be final and binding upon Bancorp, the optionees and all other persons; and

(iii)   generally, to exercise such powers and to perform such acts as are deemed necessary or expedient to promote the best interests of Bancorp with respect to this Plan.

ARTICLE V.   Eligible Participants.

(a)   Incentive options may be granted to such employees of Bancorp or any of its subsidiaries (in existence at the time of the grant), including members of the Board of Directors who are also employees of Bancorp or any of its subsidiaries (in existence at the time of the grant), as are selected by the Committee. Nonqualified options may be granted to such employees of Bancorp or any of its subsidiaries (in existence at the time of the grant) as are selected by the Committee.

(b)   Nonqualified options will be granted to persons who are Directors of Bancorp on the date of grant of option hereunder, and are not officers or employees of Bancorp or any subsidiary of Bancorp (“non-employee Directors”), only pursuant to Section 8 of this Plan.

ARTICLE VI.   Duration of the Plan . This Plan shall terminate ten (10) years from the effective date hereof, unless terminated earlier pursuant to Paragraph 13 hereafter, and no options may be granted thereafter.

ARTICLE VII.   Restrictions on Incentive Options. Incentive options granted under this Plan shall be subject to the following restrictions:

(a)   Limitation on Number of Shares . The aggregate fair market value (determined at the time such option is granted) of the stock with respect to which incentive stock options are exercisable for the first time by any individual during any calendar year (under all plans of Bancorp and subsidiary corporations as defined in Section 424 of the Code) shall not exceed $100,000. In the event, in a given calendar year, that such employee is eligible to participate in any other incentive stock option plan(s) of Bancorp or a subsidiary which is (are) also intended to comply with the provisions of Section 422 of the Code, such annual limitation shall apply to the aggregate number of Shares for which incentive’ stock options may be granted under all such plans.

(b)   10% Stockholder. If any employee to whom an incentive option is granted pursuant to the provisions of the Plan is on the date of grant the owner of stock (as determined under Section 428(d) of the Code) possessing more than 10% of the total combined voting power of all classes of stock of Bancorp or its subsidiaries, then the following special provisions shall be applicable to the incentive option granted to such individual:

(i)   The option price per Share subject to such incentive option shall not be less than 110% of the fair market value of one Share on the date of grant; and

(ii)   The incentive option shall not have a term in excess of five (5) years from the date of grant.

ARTICLE VIII.   Nonqualified and Incentive Option Grants to Directors. Notwithstanding anything to the contrary herein provided:

(a)   Grant of options. The options authorized under this Section 8 (“Director Options”) shall be granted automatically and without any further action by the Board of Directors on the fifth business day following Bancorp’s Annual Meeting of Stockholders in each year commencing in 1995 (with respect to each such year, the “Grant Date”). Director Options to purchase 1,500 shares of Common Stock (or such lesser number as shall enable each non-employee Director then in office to receive an equal grant in the event that there are not sufficient shares of Common Stock available for grant hereunder to enable each such non-employee Director to receive a grant of 1,500 shares) shall be granted to each non-employee Director duly elected and serving as such on each Grant Date. Each newly elected director shall be granted automatically and without any further action by the Board