FORM OF

                            KINGFIELD SAVINGS BANK


                                  ARTICLE  I

     1.01 Kingfield Savings Bank (the "Bank") hereby establishes the Recognition
and Retention Plan (the "Plan") and Trust (the "Trust") upon the terms and
conditions hereinafter stated in this Recognition and Retention 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 retain employees and officers of
experience and ability by providing such persons with a proprietary interest in
the Company as compensation for their contributions to the Bank and its
Affiliates and as an incentive to make such contributions and to promote the
Bank's growth and profitability in the future.

                                 ARTICLE  III

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

     3.01  "Affiliate" means the Company and those subsidiaries of the Bank or
Company which, with the consent of the Board, agree to participate in this Plan.

     3.02  "Bank" means Kingfield Savings Bank.

     3.03 "Beneficiary" means the person or persons designated by a Recipient to
receive any benefits payable under the Plan in the event of such Recipient'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 Recipient's surviving spouse, if any
or if none, his estate.


     3.04  "Board" means the Board of Directors of the Bank.

     3.05 "Committee" means the Plan Committee of the Board which shall consist
solely of non-employee directors, all of whom are "disinterested directors" as
that term so defined under Rule 16b-3 under the Securities and Exchange Act of
1934, as amended promulgated by the Securities and Exchange Commission.

     3.06 "Common Stock" means shares of the common stock. $.01 par value per
share, of the Company.

     3.07 "Company" shall mean KSB Bancorp, Inc., the parent holding
company for the Bank.

     3.08 "Conversion" shall mean the conversion of the Bank from the mutual to
stock form of organization and the acquisition of the Bank by the Company.

     3.09 "Disability" means the permanent and total inability by reason of
mental or physical infirmity, or both, of an employee to perform the work
customarily assigned to him. Additionally, a medical doctor selected or approved
by the Board of Directors must advise the Committee that it is either not
possible to determine when such Disability will terminate or that it appears
probable that such Disability will be permanent during the remainder of the said
participant's lifetime.

     3.10 "Employee" means any person who is currently employed on a full time
basis by the Bank or an Affiliate, including officers, but such term shall not
include Outside Directors.

     3.11  "Executive Officer" shall mean the President, Executive Vice
President, and any Senior Vice President of the Bank.

     3.12  "Plan Shares" means shares of Common Stock held in the Trust and
issued or issuable to a Recipient pursuant to the Plan.

     3.13  "Plan Share Award" means a right granted under this Plan to earn Plan

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

     3.15  "Recipient" means an Employee who receives a Plan Share Award under
the Plan.

     3.16 Retirement" means termination of employment or service which
constitutes normal retirement, or early retirement under any qualified
retirement plan maintained by the Bank, or by reaching age 65.


     3.17 "Trustee" 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 Committee, which shall have all of the powers allocated to it in this and
other Sections of the Plan. The interpretation and construction by the Committee
of any provisions of the Plan or of any Plan Share Award granted hereunder shall
be final and binding. The Committee shall act by vote or written consent of a
majority of its members. Subject to the express provisions and limitations of
the Plan, the Committee may adopt such rules, regulations and procedures as it
deemes appropriate for the conduct of its affairs. The Committee shall report
its actions and decisions with respect to the Plan to the Board at appropriate
times, but in no event less than one time per calendar year. The Committee shall
recommend to the Board one or more persons or entity to act as Trustee(s) in
accordance with the provision of this Plan and Trust and the terms of Article
VIII hereof.

     4.02 Role of the Board. The members of the Committee and the Trustee or
Trustees shall be appointed or approved by, and will serve at the pleasure of,
the Board. The Board may in its discretion from time to time remove members
from, or add members to, the Committee, and may remove, replace or add Trustees.
The Board shall have all of the powers allocated to it in this and other
Sections of the Plan.

     4.03 Limitation on Liability. No members of the Board or the Committee or
the Trustee(s) shall be liable for any determination made in good faith with
respect to the Plan or any Plan Shares or Plan Share Awards granted under it. If
a member of the Board or the Committee or any Trustee is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of anything done or not done by him in such capacity under or with
respect to the Plan, the Bank shall indemnify such member against expense
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonable incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in the best interests of the Bank and its Affiliates and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful.

                                   ARTICLE V

     5.01  Amount and Timing of Contributions.  The Bank shall contribute to the
Trust an amount sufficient to purchase two and two percent (2.0%) of the shares
of Common Stock issued by the Company in connection with the Conversion.  No
contributions by Employees shall be permitted.


     5.02 Initial Investment. Any amounts held by the Trust prior to the
conversion of the Bank from a mutual to a stock savings bank, or until such
amounts are invested in accordance with Section 5.03, shall be invested by the
Trustee in such interest-bearing account or accounts at the Bank as the Trustee
shall determine to be appropriate.

     5.03 Investment of Trust Assets Upon the Conversion: Creation of Plan Share
Reserve. Upon the conversion of the Bank to a stock savings bank, the Trustee
shall invest all of the Trust's assets exclusively in Common Stock except as
otherwise provided below; provided, however, that the Trust shall not invest in
more than two percent (2.0%) of the shares of Common Stock issued in the
Conversion which shall constitute the "Plan Share Reserve". In the event that
all or a portion of such shares of Common Stock are not available for purchase
by the Trust in Conversion, the Trustee, in accordance with applicable rules and
regulations, shall purchase shares of Common Stock in the open market or, in the
alternative, shall purchase authorized by unissued shares of the Common Stock
from the Company sufficient to fund the Plan share Reserve. Any earnings
received with respect to Common Stock held in the Reserve shall be held in an
interest-bearing account. Any earnings received with respect to Common Stock
subject to a Plan Share Award shall be held in an interest-bearing account on
behalf of the individual Recipient.

     5.04 Effect of Allocations, Returns and Forfeitures Upon Plan Share
Reserves. Upon the allocation of Plan Share Awards under Section 6.02, or the
decision of the Committee to return Plan Shares to the Bank, the Plan Share
Reserve shall be reduced by the number of Shares subject to the Awards so
allocated or returned. Any Shares subject to an Award which may not be earned
because of a forfeiture by the Recipient pursuant to Section 7.01 shall be
returned (added) to the Plan Share Reserve.

                                  ARTICLE  VI
                           ELIGIBILITY; ALLOCATIONS

     6.01  Eligibility.  Employees of the Bank and its Affiliates are eligible
to receive Plan Share Awards.

     6.02 Allocations. The Committee may determine which of the Employees
referenced in Section 6.01 above will be granted Plan Share Awards and the
number of Shares covered by each Award, provided, however, that the number of
Shares covered by such Awards may not exceed the number of Shares in the Plan
Share Reserve immediately prior to the grant of such Awards, and provided
further, that in no event shall any Awards be made which will violate the Stock
Charter and Bylaws of the Bank or any applicable federal or state law or
regulation. In the event Plan Shares are forfeited for any reason, the Committee
may, from time to time, determine which of the Employees referenced in Section
6.01 above will be granted additional Plan Share Awards to be awarded from
forfeited Plan Shares. In selecting those Employees to whom Plan Share Awards
will be granted and the number of Plan Shares covered by such Awards, the
Committee shall consider the position and responsibilities of the eligible
Employees, the length and value of their services to the Bank and its
Affiliates, the compensation paid to the Employees and any other factors the
Committee may deem relevant, and the Committee may


request the written recommendation of the Chief Executive Officer and other
senior executive officers of the Bank and its Affiliates. All allocations by the
Committee shall be subject to review, and approval or rejection, by the Board.

     6.03 Form of Allocation. As promptly as practicable after a determination
is made pursuant to Section 6.02 that a Plan Share Award has been granted, the
Committee shall notify the Recipient 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. The date on which the Committee so
notifies the Recipient shall be considered the date of grant of the Plan Share
Awards. The Committee shall maintain records as to all grants of Plan Share
Awards under the Plan.

     6.04 Allocations Not Required. Notwithstanding anything to the contrary in
Sections 6.01 and 6.02, no Employee shall have any right or entitlement to
receive a Plan Share Award hereunder, such Awards being at the total discretion
of the Committee and the Board, nor shall the salaried Employees as a group have
such a right. The Committee may, with the approval of the Board (or, if so
directed by the Board, may) return all Common Stock in the Plan Share Reserve to
the Company at any time, and cease issuing Plan Share Awards.

                                  ARTICLE VII

     7.01  Earning Plan Shares; Forfeitures.

     (a) General Rules. Unless the Committee shall specifically state to the
contrary at the time a Plan Share Award is granted, Plan Shares subject to an
Award shall be earned at the rate of twenty percent of the aggregate number of
Shares covered by the Award upon the first year anniversary of the effective
date of grant of the Award, and thereafter at the rate of twenty percent at the
end of each full twelve months of consecutive employment with the Bank or an
Affiliate. Notwithstanding the preceding, the Committee may provide for a less
or more rapid earnings rate than that set forth herein for all Awards or for any
given Award. If the employment of a Recipient is terminated prior to the
Recipient fully earning an Award for any reason (except as specifically provided
in Subsections (b) and (c) below), the Recipient shall forfeit the right to earn
any Shares subject to the Award which have not theretofore been earned.

     In determining the number of Plan Shares which are earned, fractional
shares shall be rounded down to the nearest whole number, provided that such
fractional shares shall be aggregated and earned on the date the final
installment of the Award is earned.

     (b) Exception for Terminations Due to Death, Disability and Retirement.
Notwithstanding the general rule contained in Section 7.01(a) above, Plan Shares
subject to a Plan Share Award held by a Recipient whose employment with the Bank
or an Affiliate terminates due to death, Disability or Retirement, or any part
thereof which have not theretofore been earned, shall be deemed earned as of the
Recipients' last day of employment with the Bank or an Affiliate.


     (c) Exception for Terminations After a Change in Control. Notwithstanding
the general rule contained in Section 7.01 (a) above, all Plan Shares subject to
a Plan Share Award held by a Recipient whose employment with the Bank or an
Affiliate terminates following a Charge in Control of the Bank or Company, shall
be deemed earned as of the Recipient's last day of employment with the Bank or
an Affiliate. For purposes of this Plan, "Change in Control of the Bank of the
Company" shall mean an event of a nature that (i) would be required to be
reported in response to Item 1(a) of the current report on Form 8-K, as in
effect on the date hereof, pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange act"); or (ii) results in a Change in
Control of the Bank or the Company within the meaning of the Change in Bank
Control Act and the Rules and Regulations promulgated by the Federal Deposit
Insurance Corporation ("FDIC") at 12 C.F.R. (S) 303.4(a) with respect to the
Bank and the Board of Governors of the Federal Reserve System ("FRB") at 12
C.F.R. (S) 225.41(b) with respect to the Company, as in effect on the date
hereof: (iii) results in a transaction requiring prior FRB approval under the
Bank Holding Company Act of 1956 and the regulations promulgated thereunder by
the FRB at 12 C.F.R. (S) 225.11, as in effect on the date hereof; or (iv)
without limitation such a Change in Control shall be deemed to have occurred at
such time as (a) any "person" (as the term is used in Sections 13(d) and 14(d)
of the Exchange Act) is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the Bank
or the Company representing 20% or more of the combined voting power of the
Bank's or the Company's outstanding securities except for any securities of the
Bank purchased by the Company in connection with the conversion of the Bank to
the stock form and any securities purchased by any tax qualified employee
benefit plans of the Bank; or (b) individuals who constitute the Board on the
date hereof (the "Incumbent Board") cease for any reason to constitute at least
a majority thereof, provided that any person becoming a director subsequent to
the date hereof whose election was approved by a vote of at least three-quarters
of the directors comprising the Incumbent Board, or whose nomination for
election by the Company's stockholders was approved by the same Nominating
Committee serving under an Incumbent Board, shall be, for purposes of this
clause (b), considered as though he were a member of the Incumbent Board; or (c)
a plan or reorganization, merger, consolidation, sale of all or substantially
all of the assets of the Bank or the Company or similar transaction has been
approved by the Incumbent Board and the Shareholders, or otherwise occurs, and
in which the Bank or Company is not the resulting entity.

     (d) Revocation for Misconduct. Notwithstanding anything hereinafter to the
contrary, the Board may by resolution immediately revoke, rescind and terminate
any Plan Share Award, or portion thereof, previously awarded under this Plan, to
the extent Plan Shares have not been delivered thereunder to the Recipient,
whether yet earned, in the case of an Employee who is discharged from the Bank
or an Affiliate for cause (as herein defined), or who is discovered after
termination of employment to have engaged in conduct that would have justified
termination for cause. "Cause" shall mean the termination because of personal
dishonesty, willful misconduct, any breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, or the willful violation
of any law, rule or regulation (other than traffic violations or similar
offenses) which result in a material loss to the Bank or final cease and desist


     7.02 Accrual of Dividends. Whenever Plan Shares are paid to a Recipient or
Beneficiary under Section 7.03, such Recipient or Beneficiary shall also be
entitled to receive, with respect to each Plan Share paid, an amount equal to
any cash dividends and a number of shares of Common Stock equal to any stock
dividends, declared and paid with respect to a share of Common Stock between the
date the relevant Plan Share Award was granted and the date the Plan Shares are
being distributed. There shall also be distributed an appropriate amount of net
earnings, if any, of the Trust with respect to any cash dividends so paid out.

     7.03  Distribution of Plan Shares.

     (a) Timing of Distributions: General Rule. Except as provided in Subsection
(b) below, Plan Shares shall be distributed to the Recipient or his Beneficiary,
as the case may be, 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.
One share of Common Stock shall be given for each Plan Share earned and payable.
Payments representing accumulated cash dividends (and earning thereon) shall be
made in cash.

     (c) Withholding. The Trustee may withhold from any payment or distribution
made under this Plan sufficient amounts of cash or shares Common Stock to cover
any applicable withholding and employment taxes, and if the amount of such
payment is insufficient, the Trustee may require the Recipient or Beneficiary to
pay to the Trustee the amount required to be withheld as a condition of
delivering the Plan Shares. Alternatively, a Recipient may pay to the Trustee
the amount of cash necessary to be withheld for taxes in lieu of any withholding
of payments or distribution under this Plan. The Trustee shall pay over to the
Bank or Affiliate which employs or employed such Recipient any such amount
withheld from or paid by the Recipient or Beneficiary. If a Recipient elects to
have such taxes withheld, the elections must be made in compliance with Rule
16b-3 in order to receive exemptive treatment.

     7.04 Voting of Plan Shares. After a Plan Share Award has been granted, the
Recipient shall be entitled to direct the Trustee as to the voting of the Plan
Shares which are covered by the Plan Share Award and which have not yet been
earned and distributed to him pursuant to Section 7.03, subject to rules and
procedures adopted by the Committee for this purpose. All shares of Common Stock
held by the Trust as to which Recipients are not entitled to direct, or have not
directed, the voting, shall be voted by the Trustee in the same proportion as
Plan Shares which have been awarded and voted.

                                 ARTICLE  VIII

     8.01 Trust. The Trustee shall received, hold, administer, invest and make
distributions and disbursements from the Trust in accordance with the provisions
of the Plan and Trust and the applicable directions, rules, regulations,
procedures and policies established by the committee pursuant to the Plan.


     8.02 Management of Trust. It is the intent of this Plan and Trust that,
subject to the provisions of this Plan, the Trustee shall have complete
authority and discretion with respect to the management, control and investment
of the Trust, and that Trustee shall invest all assets of the Trust, except
those attributable to cash dividends paid with respect to Plan Shares, in Common
Stock to the fullest extent practicable, and except to the extent that the
Trustee determines that the holding of monies in cash or cash equivalents is
necessary to meet the obligation of the Trust. In performing their duties, the
Trustees shall have the power to do all things and execute such instruments as
may be deemed necessary or proper, including the following powers:

     (a) To invest up to one hundred percent (100%) of all Trust assets in
Common Stock without regard to any law now or hereafter in force limiting
investments for Trustees or other fiduciaries. The investment authorized herein
constitutes the only investment of the Trust, and in making such investment, the
Trustees are authorized to purchase Common Stock from the Company or an
Affiliate or from any other source, and such Common Stock so purchased may be
outstanding, newly issued, or Treasury shares.

     (b) To invest any Trust assets not otherwise invested in accordance with
(a) above in such deposit accounts, and certificates of deposit (including those
issued by the Bank), obligations of the United States government or its agencies
or such other investments as shall be considered the equivalent of cash.

     (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, without the addition of words indicating that such security is an
asset of the Trust (but accurate records shall be maintained showing that such
security is an asset of the Trust.)

     (e) To hold cash without interest in such amounts as may be in the opinion
of the Trustee 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, and such other legal services or representation as
they may deem desirable.

     (h) To hold funds and securities representing the amounts to be distributed
to a Recipient or his Beneficiary as a consequence of a dispute as to the
disposition thereof, whether in a segregated account or held in common with
other assets of the Trust.

     Notwithstanding anything herein contained to the contrary, the Trustee
shall not be required to make any inventory, appraisal or settlement or report
to any court or to secure any order of court for the exercise of any power
herein contained, or give bond.


     8.03 Records and Accounts. The Trustee shall maintain accurate and detailed
records and accounts of all transactions of the Trust, which shall be available
at all reasonable times for inspection by any legally entitled person or entity
to the extent required by applicable law, or any other person determined by the

     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, to bookkeeping accounts for Recipients or to the general account of
the Trust, depending on the nature and allocation of the assets generating such
earnings, gains and losses. In particular, any earnings on cash dividends
received with respect to shares of Common Stock shall be allocated to accounts
for Recipients, if such shares are subject of outstanding Plan Share Awards, or,
otherwise to the Plan Share Reserve.

     8.05 Expenses. All costs and expenses incurred in the operation and
administration of this Plan, including those incurred by the Trustee, shall be
borne by the Bank.

     8.06 Indemnification. The Bank 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 the same shall be due to their gross negligence or willful

                                  ARTICLE  IX

     9.01 Adjustments for Capital Changes. In the event of any change in the
outstanding shares of Common Stock of the Company by reason of any stock
dividend or split, recapitalization, merger, consolidation, spin-off,
reorganization, combination or exchange of shares, or other similar corporate
change, or other increase or decrease in such shares effected without receipt or
payment of consideration by the Company, the Committee shall adjust the
aggregate number of Plan Shares available for issuance pursuant to the Plan and
shall adjust the number of shares to which any Plan Share Award relates to
prevent dilution or enlargement of the rights granted to the Recipient under the

     9.02 Amendment and Termination of Plan. The Board may, by resolution, at
any time amend or terminate the Plan and Trust. The power to amend or terminate
shall include the power to direct the Trustee to return to the Bank all or any
part of the assets of the Trust, including shares of Common Stock held in the
Plan Share Reserve, as well as shares of Common Stock and other assets subject
to Plan Share Awards but not yet earned by the Employees to whom they are
allocated; provide that any shares of Common Stock held by the Trust as part of
its assets must be disposed of by the Trustee prior to returning the proceeds
representing such assets to the Bank. However, the termination of the Trust
shall not affect a Recipient's right to earn Plan Share Awards and to the
distribution of Common Stock relating thereto, including earnings thereon, in
accordance with the terms of this Plan and the grant by the Committee or Board.


     9.03   Nontransferable.  Plan Share Awards and rights to Plan Shares shall
not be transferable by a Recipient, and during the lifetime of the Recipient,
Plan Shares may only be earned by and paid to the Recipient who was notified in
writing of the Award by the Committee pursuant to Section 6.03.

    9.04 Employment Rights. Neither the Plan nor any grant of a Plan Share Award
or Plan Shares hereunder nor any action taken by the Trustee, the Committee or
the Board in connection with the Plan shall create any right on the part of any
Employee to continue in the employ of the Bank or an Affiliate thereof, or the

    9.05 Voting and Dividend Rights. No Recipient shall have any voting or
dividend rights or other rights of a shareholder in respect of any Plan Shares
covered by a Plan Share Award, except as expressly provided in Sections 7.02 and
7.04 above, prior to the time said Plans Shares are actually distributed to him.

    9.06 Governing Law. The validity, interpretation, performance and
enforcement of the Plan and Trust shall be governed by the laws of the State of

    9.07 Effective Date. This Plan is effective as of the effective date of the
conversion of the Bank from the mutual to capital stock form of organization.
Following Conversion, the Plan shall be presented to shareholders of the Company
for ratification for purposes of (i) obtaining favorable treatment under Section
16(b) of the Securities Exchange Act of 1934; and (ii) maintaining (if listed)
listing on the Nasdaq Small-Cap Market; provided, however, that the failure to
obtain shareholder ratification will not affect the validity of the Plan and the
Plan Share Awards thereunder.

    9.08 Term of Plan. This Plan shall remain in effect until the earlier of (1)
21 years from the Effective Date, (2) termination by the Board of Directors of
the Company, or (3) the distribution of all assets of the Trust. Termination of
the Plan shall not affect any Plan Share Awards previously granted, and such
Awards shall remain valid and in effect until they have been earned and paid, or
by their terms expire or are forfeited.


Basic Info X:

Type: Trust Agreement
Date: April 2, 2001
State: Maine

Other info: