UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.__)

Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to ss.240.14a-12

Monadnock Community Bancorp, Inc.
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(Name of Registrant as Specified In Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1) Title of each class of securities to which transaction applies:

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2) Aggregate number of securities to which transaction applies:

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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):

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[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

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2) Form, Schedule or Registration Statement No.:

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4) Date Filed:

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Monadnock Community Bancorp, Inc. [LOGO]

March 24, 2005

Dear Stockholder:

We cordially invite you to attend the 2005 Annual Meeting of Stockholders of
Monadnock Community Bancorp, Inc., the parent company of Monadnock Community
Bank. The annual meeting will be held at the RiverMead Auditorium, located at
150 Rivermead Road, Peterborough, New Hampshire 03458, at 10:30 a.m., local
time, on May 12, 2005.

The enclosed notice of annual meeting of stockholders and proxy statement
describes the formal business to be transacted at the annual meeting. During the
annual meeting we will also report on the operations of Monadnock Community
Bancorp. Directors and officers of Monadnock Community Bancorp will be present
to respond to any questions that stockholders may have.

The business to be conducted at the annual meeting includes the election of
three directors, the approval of the Monadnock Community Bancorp 2005 Stock
Option Plan, the approval of the Monadnock Community Bancorp 2005 Recognition
and Retention Plan, and the ratification of the appointment of Shatswell,
MacLeod & Company, P.C. as the independent auditors for Monadnock Community
Bancorp for the fiscal year ending December 31, 2005.

The board of directors of Monadnock Community Bancorp has determined that the
matters to be considered at the annual meeting are in the best interests of
Monadnock Community Bancorp and its stockholders. For the reasons set forth in
the proxy statement, the board of directors unanimously recommends a vote "FOR"
each matter to be considered.

Also enclosed for your review is our 2004 Annual Report to Stockholders, which
contains detailed information concerning the activities and operating
performance of Monadnock Community Bancorp. On behalf of the board of directors,
we urge you to vote your shares of common stock as soon as possible even if you
currently plan to attend the annual meeting. You can vote your shares of common
stock prior to the annual meeting by mail with the enclosed proxy card, in each
case, in accordance with the instructions on the proxy card. This will not
prevent you from voting in person, but will assure that your vote is counted if
you are unable to attend the annual meeting.

Sincerely,

/s/ William M. Pierce, Jr.

William M. Pierce, Jr.
President and Chief Executive Officer

One Jaffrey Road o P.O. Box 888 o Peterborough, New Hampshire 03458
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www.monadnockbank.com o FAX: 603-924-9379 o TEL: 603-924-9654 o 800-924-9654

MONADNOCK COMMUNITY BANCORP, INC.
One Jaffrey Road
Peterborough, New Hampshire 03458
(603) 924-9654

NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
To be held on May 12, 2005

Notice is hereby given that the 2005 Annual Meeting of Stockholders of
Monadnock Community Bancorp, Inc. ("Monadnock Community Bancorp"), will be held
at the RiverMead Auditorium, located at 150 Rivermead Road, Peterborough, New
Hampshire 03458, on May 12, 2005, at 10:30 a.m., local time.

A proxy card and a proxy statement for the annual meeting are enclosed.

The annual meeting is for the purpose of considering and acting upon:

1. The election of three directors of Monadnock Community Bancorp;

2. The approval of the Monadnock Community Bancorp 2005 Stock Option
Plan;

3. The approval of the Monadnock Community Bancorp 2005 Recognition and
Retention Plan;

4. The ratification of the appointment of Shatswell, MacLeod & Company,
P.C. as the independent auditors for Monadnock Community Bancorp for
the fiscal year ending December 31, 2005; and

such other matters as may properly come before the annual meeting, or any
adjournments thereof. The board of directors of Monadnock Community Bancorp is
not aware of any other business to come before the annual meeting.

Any action may be taken on the foregoing proposals at the annual meeting
on the date specified above, or on any date or dates to which the annual meeting
may be adjourned. Stockholders of record at the close of business on March 14,
2005, are the stockholders entitled to vote at the annual meeting, and any
adjournments thereof.

EVEN IF YOU DO NOT PLAN TO ATTEND THE ANNUAL MEETING, PLEASE VOTE YOUR
SHARES OF COMMON STOCK WITHOUT DELAY. YOU CAN VOTE YOUR SHARES OF COMMON STOCK
PRIOR TO THE ANNUAL MEETING BY MAIL WITH THE ENCLOSED PROXY CARD, IN EACH CASE,
IN ACCORDANCE WITH THE INSTRUCTIONS ON THE PROXY CARD. YOU MAY REVOKE A PROXY AT
ANY TIME BEFORE WE VOTE AT THE ANNUAL MEETING. YOU MAY DO SO BY EXECUTING AND
RETURNING A PROXY CARD DATED LATER THAN A PREVIOUSLY SUBMITTED PROXY, BY
PROPERLY SUBMITTING A LATER DATED PROXY OR BY SUBMITTING A WRITTEN REVOCATION TO
THE SECRETARY OF MONADNOCK COMMUNITY BANCORP BEFORE THE VOTE IS TAKEN AT THE
ANNUAL MEETING. IF YOU HOLD SHARES OF COMMON STOCK THROUGH A BROKER, YOU SHOULD
FOLLOW THE INSTRUCTIONS OF YOUR BROKER REGARDING REVOCATION OF PROXIES. IF YOU
ATTEND THE ANNUAL MEETING YOU MAY REVOKE YOUR PROXY AND VOTE PERSONALLY ON EACH
MATTER BROUGHT BEFORE THE ANNUAL MEETING. HOWEVER, IF YOUR SHARES ARE NOT
REGISTERED IN YOUR NAME, YOU WILL NEED ADDITIONAL DOCUMENTATION FROM YOUR RECORD
HOLDER TO VOTE PERSONALLY AT THE ANNUAL MEETING.

By Order of the Board of Directors

/s/ Thomas C. LaFortune

Thomas C. LaFortune
Secretary

Peterborough, New Hampshire
March 24, 2005

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A SELF-ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS
REQUIRED IF MAILED WITHIN THE UNITED STATES.
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Proxy Statement

MONADNOCK COMMUNITY BANCORP, INC.
One Jaffrey Road
Peterborough, New Hampshire 03458
(604) 924-9654

ANNUAL MEETING OF STOCKHOLDERS
May 12, 2005

This proxy statement is furnished in connection with the solicitation of
proxies on behalf of the board of directors of Monadnock Community Bancorp, Inc.
("Monadnock Community Bancorp"), to be used at the 2005 Annual Meeting of
Stockholders of Monadnock Community Bancorp which will be held at the RiverMead
Auditorium, located at 150 Rivermead Road, Peterborough, New Hampshire 03458, on
May 12, 2005, at 10:30 a.m., local time, and all adjournments of the annual
meeting. The accompanying notice of annual meeting of stockholders and this
proxy statement are first being mailed to stockholders on or about March 24,
2005.

REVOCATION OF PROXIES

Stockholders who execute proxies in the form solicited hereby retain the
right to revoke them in the manner described below. Unless so revoked, the
shares represented by such proxies will be voted at the annual meeting and all
adjournments thereof. Proxies solicited on behalf of the board of directors of
Monadnock Community Bancorp will be voted in accordance with the directions
given thereon. You can vote your shares of Monadnock Community Bancorp common
stock prior to the annual meeting by signing and returning the enclosed proxy
card to Monadnock Community Bancorp, in accordance with instructions set forth
on the proxy card. Proxies received by Monadnock Community Bancorp, which are
signed, but contain no instructions for voting, will be voted "FOR" the
proposals set forth in this proxy statement for consideration at the annual
meeting.

Proxies may be revoked by sending written notice of revocation to the
Secretary of Monadnock Community Bancorp, Thomas C. LaFortune, at the address
of Monadnock Community Bancorp shown above, or by returning a duly executed
proxy bearing a later date by mail. The presence at the annual meeting of any
stockholder who had given a proxy shall not revoke such proxy unless the
stockholder delivers his or her ballot in person at the annual meeting or
delivers a written revocation to the Secretary of Monadnock Community Bancorp
prior to the voting of such proxy.

VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF

Holders of record of Monadnock Community Bancorp's common stock, par value
$0.01 per share, as of the close of business on March 14, 2005 are entitled to
one vote for each share then held. As of March 14, 2005, there were 939,631
shares of common stock issued and outstanding. The presence in person or by
proxy of a majority of the outstanding shares of common stock entitled to vote
is necessary to constitute a quorum at the annual meeting. Abstentions and
broker non-votes will be counted for purposes of determining that a quorum is
present.

As to the election of directors, the proxy card being provided by the
board of directors enables a stockholder to vote FOR the election of the
nominees proposed by the board of directors, or to WITHHOLD authority to vote
for one or more of the nominees being proposed. Directors are elected by a
plurality of votes cast, without regard to either broker non-votes, or proxies
as to which the authority to vote for the nominees being proposed is withheld.

As to the approval of the Monadnock Community Bancorp 2005 Stock Option
Plan, by checking the appropriate box, a stockholder may: (i) vote FOR the
approval; (ii) vote AGAINST the approval; or (iii) ABSTAIN from voting on such
approval. The affirmative vote of (x) a majority of the votes eligible to be
cast at the annual

meeting and (y) a majority of the votes cast at the annual meeting by
stockholders other than Monadnock Mutual Holding Company (without regard to
broker non-votes or proxies marked "ABSTAIN") is required for the approval of
the Monadnock Community Bancorp 2005 Stock Option Plan.

As to the approval of the Monadnock Community Bancorp 2005 Recognition and
Retention Plan, by checking the appropriate box, a stockholder may: (i) vote FOR
the approval; (ii) vote AGAINST the approval; or (iii) ABSTAIN from voting on
such approval. The affirmative vote of (x) a majority of the votes eligible to
be cast at the annual meeting and (y) a majority of the votes cast at the annual
meeting by stockholders other than Monadnock Mutual Holding Company (without
regard to broker non-votes or proxies marked "ABSTAIN") is required for the
approval of the Monadnock Community Bancorp 2005 Recognition and Retention Plan.

As to the ratification of Shatswell, MacLeod & Company, P.C. as Monadnock
Community Bancorp's independent auditor, by checking the appropriate box, a
stockholder may: (i) vote FOR the ratification; (ii) vote AGAINST the
ratification; or (iii) ABSTAIN from voting on such ratification. The affirmative
vote of holders of a majority of the votes cast at the annual meeting in person
or by proxy is required for the ratification of Shatswell, MacLeod & Company,
P.C. as the independent auditor for the fiscal year ending December 31, 2005.
The ratification of this matter shall be determined by a majority of the votes
cast at the annual meeting, without regard to broker non-votes or proxies marked
"ABSTAIN".

Management of Monadnock Community Bancorp anticipates that Monadnock
Mutual Holding Company, the majority stockholder of Monadnock Community Bancorp,
will vote all of its shares of common stock in favor of all the matters set
forth above. If Monadnock Mutual Holding Company votes all of its shares in
favor of each proposal, the approval of the election of the director nominees
and the ratification of Shatswell, MacLeod & Company, P.C. would be assured. As
of March 14, 2005, Monadnock Mutual Holding Company held 516,797 shares of
common stock and persons other than Monadnock Mutual Holding Company held
422,834 shares of common stock.

Persons and groups who beneficially own in excess of 5% of the common
stock of Monadnock Community Bancorp are required to file certain reports with
the Securities and Exchange Commission regarding such ownership pursuant to the
Securities Exchange Act of 1934, as amended. The following table sets forth, as
of March 14, 2005, the shares of common stock beneficially owned by each person
who was the beneficial owner of more than 5% of the outstanding shares of common
stock of Monadnock Community Bancorp, as well as shares beneficially owned in
the aggregate by Monadnock Mutual Holding Company and all directors and
executive officers as a group.

Amount of Shares
Owned and Nature Percent of Shares
Name and Address of of Beneficial of Common Stock
Beneficial Owners Ownership (1) Outstanding
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Monadnock Mutual Holding Company 516,797 55%
One Jaffrey Road
Peterborough, New Hampshire 03458

Monadnock Mutual Holding Company, 557,136 59%
and all of Monadnock Community Bancorp,
Inc.'s and Monadnock Community Bank's
directors and executive officers as a group
(10 directors and officers) (2)

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(1) In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, a
person is deemed to be the beneficial owner for purposes of this table, of
any shares of common stock if he has shared voting or investment power
with respect to such security, or has a right to acquire beneficial
ownership at any time within 60 days from the date as of which beneficial
ownership is being determined. As used herein, "voting power" is the power
to vote or direct the voting of shares and "investment power" is the power
to dispose or direct the disposition of shares, and includes all shares
held directly as well as by spouses and minor children, in trust and other
indirect ownership, over which shares the named individuals effectively
exercise sole or shared voting or investment power.
(2) Includes shares of common stock held by Monadnock Mutual Holding Company,
of which Monadnock Community Bancorp's and Monadnock Community Bank's
directors and three of its executive officers are also executive officers
and directors. Monadnock

Community Bancorp's and Monadnock Community Bank's executive officers and
directors beneficially owned 40,339 shares of common stock, or 4.3% of the
outstanding shares of common stock.

PROPOSAL I - ELECTION OF DIRECTORS

Monadnock Community Bancorp's board of directors consists of seven
members. Monadnock Community Bancorp's bylaws provide that approximately
one-third of the directors are to be elected annually. Directors of Monadnock
Community Bancorp are generally elected to serve for a three-year period, or a
shorter period if the director is elected to fill a vacancy, and until their
respective successors shall have been elected and shall qualify. Three directors
will be elected at the annual meeting and will serve until their successors have
been elected and qualified. The governance/nominating committee of Monadnock
Community Bancorp has nominated William M. Pierce, Jr. and Kenneth R. Simonetta
to serve as directors for three-year terms. Edward J. Shea has been nominated to
serve a one year term to fill the unexpired term of Richard J. Wargo who
resigned from the board of directors on September 9, 2004. Mr. Shea was
previously approved to fill Mr. Wargo's position and under Monadnock Community
Bancorp's bylaws must be elected to fill the unexpired term. All of the nominees
are currently members of the board of directors.

The table below sets forth certain information regarding the composition
of Monadnock Community Bancorp's board of directors as of March 14, 2005,
including the terms of office of board members. It is intended that the proxies
solicited on behalf of the board of directors (other than proxies in which the
vote is withheld as to the nominee) will be voted at the annual meeting for the
election of the nominees identified below. If the nominees are unable to serve,
the shares represented by all such proxies will be voted for the election of
such substitute as the board of directors may recommend. At this time, the board
of directors knows of no reason why the nominees might be unable to serve, if
elected. Except as indicated herein, there are no arrangements or understandings
between the nominees and any other person pursuant to which such nominees were
selected.

Shares of
Positions Common Stock
Held with Monadnock Director Term to Beneficially Percent
Name (1) Age(2) Community Bancorp Since (3) Expire Owned (4) of Class
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NOMINEES
William M. Pierce, Jr. 51 Director, President and 1999 2008 8,239(5) *
Chief
Executive Officer

Kenneth R. Simonetta 63 Director and Assistant 1999 2008 4,375 *
Secretary

Edward J. Shea 67 Director 2004 2006 0 *

DIRECTORS CONTINUING IN OFFICE

Samuel J. Hackler 60 Director and Vice Chairman 1996 2006 8,750 *

Kenneth A. Christian 60 Director and Chairman of 2001 2007 9,375(6) *
the Board

Jack Goldstein 82 Director 1997 2007 100 *

Thomas C. LaFortune 66 Director and Secretary 1997 2007 3,400(7) *

EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS

Karl F. Betz 41 Senior Vice President, N/A N/A 0 *
Chief
Financial Officer and
Treasurer

Donald R. Blanchette 51 Senior Vice President N/A N/A 2,000 *

David A. Reilly** 63 Senior Vice President and N/A N/A 4,100(8) *
Senior Loan Officer

All directors and 40,339(9) 4.29%
executive officers as a
group (10 persons)

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* Less than 1%.
** Mr. Reilly is an officer of Monadnock Community Bank only.
(1) The mailing address for each person listed is One Jaffrey Road,
Peterborough, New Hampshire 03458.
(2) As of December 31, 2004.
(3) Reflects initial appointment to the board of directors of Monadnock
Community Bank as a mutual savings bank with the exception of Director
Shea. Each director of Monadnock Community Bancorp is also a director of
Monadnock Community Bank and Monadnock Mutual Holding Company, which owns
the majority of the issued and outstanding shares of common stock of
Monadnock Community Bancorp.
(4) See definition of "beneficial ownership" in the table in "Voting
Securities and Principal Holders Thereof."
(5) Includes 300 shares held as custodian for Mr. Pierce's children.
(6) Includes 2,500 shares of common stock held by Mr. Christian's spouse and
625 shares held by his mother's estate.
(7) Includes 3,400 shares of common stock held by Mr. LaFortune's spouse's
IRA.
(8) Includes 2,300 shares of common stock held jointly with Mr. Reilly's
spouse and 500 shares of common stock held by Mr. Reilly's spouse's IRA.
(9) No shares of common stock were allocated to the accounts of executive
officers under the Monadnock Community Bancorp employee stock ownership
plan for fiscal 2004. The plan holds 16,913 shares of common stock that
are unallocated, or 1.8% of the common stock outstanding for the benefit
of employees. Under the terms of the employee stock ownership plan, shares
of common stock allocated to the account of employees are voted in
accordance with instructions of the respective employees. Unallocated
shares of common stock are voted by the trustee of the employee stock
ownership plan.

The principal occupation during the past five years of each director of
Monadnock Community Bancorp is set forth below. All directors have held their
present positions for five years unless otherwise stated.

William M. Pierce, Jr. Mr. Pierce has served as president and chief
executive officer of Monadnock Community Bank since October 1999. He served as
Vice President and Chief Operating Officer from August 1997 until his
appointment to such positions.

Kenneth R. Simonetta. Mr. Simonetta is the president of the Sims Press, a
commercial printing company located in Peterborough, New Hampshire. He has been
employed by the Sims Press since 1967.

Edward J. Shea. Mr. Shea is the chief executive officer of Belletetes,
Inc., a lumber company with retail facilities in New Hampshire and
Massachusetts. He has been chief executive officer since 2002. He has spent the
last 40 years in the retail lumber business.

Samuel J. Hackler. Mr. Hackler is the president and owner of New Hampshire
Antiques, Milford, New Hampshire, an antiques retail establishment that he has
operated since 1983.

Kenneth A. Christian. Mr. Christian is an owner and principal in the firm
of Bellows, Nichols Agency, an insurance agency, located in Peterborough, New
Hampshire. He has been associated with the firm since 1970.

Jack Goldstein. Mr. Goldstein is currently retired. He served as the
trustee for the Automobile Wholesalers Association of New England Insurance
Trust and as a management consultant for over 20 years.

Thomas C. LaFortune. Mr. LaFortune has been a self-employed tax preparer
in Peterborough, New Hampshire since 1982.

Executive Officers Who Are Not Directors

The business experience for at least the past five years for each of three
executive officers of Monadnock Community Bank, including service with the bank
in mutual form, who do not serve as directors, is set forth below.

Karl F. Betz. Mr. Betz was appointed as senior vice president, chief
financial officer and treasurer of Monadnock Community Bancorp and Monadnock
Community Bank in November of 2004. Mr. Betz has spent the last 20 years in the
accounting and banking business. He was previously the finance officer and
secretary of the Board of Directors for Ocean National Bank, Portsmouth, New
Hampshire, where he served from June 2004 to November 2004. Previously he served
in a variety of positions with Granite Bank, Keene, New Hampshire (the

predecessor of Ocean National Bank), from 1997 to January 2000, most recently as
the controller and administrative vice president from January 2000 to June 2004.

Donald R. Blanchette. Mr. Blanchette serves as senior vice president, a
position he has held since November 2004. From July 1998 until November 2004, he
also served as treasurer.

David A. Reilly. Mr. Reilly has served as senior vice president and senior
loan officer since April 1999. He previously served as a commercial lending
officer for Granite Bank from 1991 until December 1998.

Board Independence

The board of directors consists of a majority of "independent directors"
within the meaning of the Nasdaq corporate governance listing standards. The
board of directors of Monadnock Community Bancorp has determined that directors
Kenneth A. Christian, Jack Goldstein, Samuel J. Hackler, Thomas C. LaFortune,
Kenneth R. Simonetta and Edward J. Shea are each "independent" within the
meaning of the Nasdaq corporate governance listing standards. The board of
directors has adopted a policy that the independent directors of the board shall
meet in executive sessions periodically, which meetings may be held in
conjunction with regularly scheduled board meetings.

Meetings and Committees of the Board of Directors

The business of Monadnock Community Bancorp is conducted at regular and
special meetings of the full board of directors and its standing committees. The
standing committees consist of the executive, audit, compensation and
governance/nominating committees. During the fiscal year ended December 31,
2004, the board of directors met at 25 regular meetings and no special meetings
were called. No director attended fewer than 75% in the aggregate of the total
number of board meetings held and the total number of committee meetings on
which he served during fiscal 2004.

Executive Committee. All board members serve on the committee. The
executive committee meets monthly or more frequently as needed. The executive
committee is generally authorized to act on behalf of the full board of
directors when certain business matters require prompt action. The executive
committee did not meet during the fiscal year ended December 31, 2004.

Audit Committee. All board members with the exception of director Pierce
serve on this committee. Mr. LaFortune is the chairman of the committee. The
audit committee meets with the internal auditor to review audit programs and the
results of audits of specific areas as well as other regulatory compliance
issues. In addition, the audit committee meets with the independent certified
public accountants on a quarterly basis to discuss the results of operations and
on an annual basis to review the results of the annual audit and other related
matters. Each member of the audit committee is "independent" as defined in the
Nasdaq corporate governance listing standards. The board of directors has
determined that director LaFortune qualifies as an "audit committee financial
expert" as that term is used in the rules and regulations of the Securities and
Exchange Commission. Monadnock Community Bancorp's board of directors has
adopted a written charter for the audit committee. A copy of such charter is
attached as Appendix A to this proxy statement. The audit committee met ten
times during the fiscal year ended December 31, 2004.

Compensation Committee. The compensation committee is responsible for
recommending to the full board the compensation of the chief executive officer
and senior management, reviewing and administering overall compensation policy,
including setting performance measures and goals, approving benefit programs,
establishing compensation of the board of directors and other matters of
personnel policy and practice. All board members with the exception of director
Pierce serve on this committee. Mr. LaFortune is the chairman of the committee.
Each member of the compensation committee is considered "independent" as defined
in the Nasdaq corporate governance listing standards. The compensation committee
of Monadnock Community Bancorp met three times during 2004.

Governance/Nominating Committee. All board members serve on this
committee. Mr. Christian is the chairman of the committee. Each member of the
governance/nominating committee with the exception of director

Pierce is considered "independent" as defined in the Nasdaq corporate governance
listing standards. The board of directors of Monadnock Community Bancorp has
adopted a written charter for the governance/nominating committee, which is
available through Monadnock Community Bancorp's website at
http://www.monadnockbank.com.
- ----------------------------

The functions of the governance/nominating committee include the
following:

o leading the search for individuals qualified to become members of
the board of directors and to select director nominees to be
nominated by the board of directors and presented for stockholder
approval;

o conducting reviews as appropriate into the background and
qualifications of director candidates;

o developing and recommending to the board of directors standards for
the selection of individuals to be considered for election or
re-election to the board of directors;

o adopting procedures for the submission of recommendations by
stockholders for nominees for the board of directors;

o annually reviewing the adequacy of its charter and recommending any
proposed changes to the board of directors and its committees; and

o considerations and making recommendations regarding board and
committee performance and continuing education guidelines.

The governance/nominating committee identifies nominees by first
evaluating the current members of the board of directors willing to continue in
service. Current members of the board of directors with skills and experience
that are relevant to Monadnock Community Bancorp's business and who are willing
to continue in service are first considered for re-nomination, balancing the
value of continuity of service by existing members of the board of directors
with that of obtaining a new perspective. In addition, the governance/nominating
committee is authorized by its charter to engage a third party to assist in the
identification of director nominees. The governance/nominating committee would
seek to identify a candidate who, at a minimum, satisfies the following
criteria:

o the highest personal and professional ethics and integrity and whose
values are compatible with the Monadnock Community Bancorp's values;

o experience and achievements that have given them the ability to
exercise and develop good business judgment;

o a willingness to devote the necessary time to the work of the board
of directors and its committees, which includes being available for
board and committee meetings;

o a familiarity with the communities in which Monadnock Community
Bancorp operates and/or is actively engaged in community activities;

o involvement in other activities or interests that do not create a
conflict with their responsibilities to Monadnock Community Bancorp
and its stockholders; and

o the capacity and desire to represent the balanced, best interests of
the stockholders of Monadnock Community Bancorp as a group, and not
primarily a special interest group or constituency.

The governance/nominating committee will also take into account whether a
candidate satisfies the criteria for "independence" under the Nasdaq corporate
governance listing standards.

Procedures for the Nomination of Directors by Stockholders. The
governance/nominating committee has adopted procedures for the submission of
director nominees by stockholders of Monadnock Community Bancorp. If a
determination is made that an additional candidate is needed for the board of
directors, the governance/nominating committee will consider candidates
submitted by Monadnock Community Bancorp's stockholders. Stockholders can submit
the names of qualified candidates for director by writing to the chairman of the
governance/nominating committee at One Jaffrey Road, Peterborough, New Hampshire
03458. The chairman must receive a submission not less than one hundred and
twenty (120) days prior to the date of Monadnock Community Bancorp's proxy
materials for the preceding year's annual meeting unless the meeting date is
changed by more than thirty (30) days in which case such recommendation must be
made by the close of business on the 10th day following such public announcement
of the changed meeting date. The submission must include the following
information:

o a statement that the writer is a stockholder of Monadnock Community
Bancorp and is proposing a candidate for consideration by the
governance/nominating committee;

o the name and address of the stockholder as they appear on Monadnock
Community Bancorp's books, and number of shares of Monadnock
Community Bancorp's common stock that are owned beneficially by such
stockholder (if the stockholder is not a holder of record,
appropriate evidence of the stockholder's ownership will be
required);

o the name, address and contact information for the candidate, and the
number of shares of common stock of Monadnock Community Bancorp that
are owned by the candidate (if the candidate is not a holder of
record, appropriate evidence of the stockholder's ownership should
be provided);

o a statement of the candidate's business and educational experience;

o such other information regarding the candidate as would be required
to be included in the proxy statement pursuant to Regulation 14A of
the Securities Exchange Act of 1934;

o a statement detailing any relationship between the candidate and any
customer, supplier or competitor of Monadnock Community Bancorp or
its affiliates;

o detailed information about any relationship or understanding between
the proposing stockholder and the candidate; and

o a statement of the candidate that the candidate is willing to be
considered and willing to serve as a director of Monadnock Community
Bancorp if nominated and elected.

A nomination submitted by a stockholder for presentation by the
stockholder at an annual meeting of stockholders of Monadnock Community Bancorp
must comply with the procedural and informational requirements described in
Monadnock Community Bancorp's bylaws.

Stockholder Communications with the Board of Directors. A stockholder of
Monadnock Community Bancorp who wants to communicate with the board of directors
or with any individual director can write to Monadnock Community Bancorp at One
Jaffrey Road, Peterborough, New Hampshire 03458, attention: Chairman of the
Governance/Nominating Committee. The letter should indicate that the author is a
stockholder of Monadnock Community Bancorp and, if shares are not held of
record, should include appropriate evidence of stock ownership. Depending on the
subject matter, management will:

o forward the communication to the director or directors to whom it is
addressed;

o attempt to handle the inquiry directly, for example, a request for
information about Monadnock Community Bancorp or if it is a
stock-related matter; or

o not forward the communication if it is primarily commercial in
nature, relates to an improper or irrelevant topic, or is unduly
hostile, threatening, illegal or otherwise inappropriate.

At each board of directors meeting, management shall present a summary of
all communications received since the last meeting that were not forwarded and
make those communications available to the directors upon request.

Code of Ethics

The board of directors has adopted a Code of Business Conduct and Ethics
that applies to all of Monadnock Community Bancorp's officers, directors and
employees, and a Code of Ethics for the Chief Executive Officer and Senior
Financial Officers (collectively the "Codes"). The Codes are intended to promote
honest and ethical conduct, full and accurate reporting and compliance with
laws. The Codes are available through Monadnock Community Bancorp's website at
www.monadnockbank.com. Amendments to and waivers from the Code of Ethics will
- ---------------------
also be disclosed on Monadnock Community Bancorp's website.

Audit Committee Report

The audit committee of Monadnock Community Bancorp operates under a
written charter adopted by the board of directors which is attached as Appendix
A to this proxy statement. The audit committee charter is also available through
Monadnock Community Bancorp's website at www.monadnockbank.com. The audit
---------------------
committee of Monadnock Community Bancorp has issued a report which states that
it has:

o reviewed and discussed with management and Monadnock Community
Bancorp's independent auditors, Monadnock Community Bancorp's
audited consolidated financial statements for the fiscal year ended
December 31, 2004;

o discussed with the independent auditors the matters required to be
discussed by Statement on Auditing Standards No. 61, Communications
with Audit Committees, as amended; and

o received the written disclosures and the letter from the independent
accountants required by Independence Standards Board Standard No. 1,
Independence Discussions with Audit Committees, and have discussed
with the independent accountants their independence from Monadnock
Community Bancorp.

Based on the review and discussions referred to above, the audit committee
recommended to the board of directors of Monadnock Community Bancorp that the
audited consolidated financial statements be included in Monadnock Community
Bancorp's annual report on Form 10-KSB for the fiscal year ended December 31,
2004 and to be filed with the Securities and Exchange Commission. In addition,
the audit committee approved the appointment of Shatswell, MacLeod & Company,
P.C. as the independent auditors for Monadnock Community Bancorp for the fiscal
year ending December 31, 2005, subject to the ratification of this appointment
by the stockholders of Monadnock Community Bancorp.

This report shall not be deemed incorporated by reference by any general
statement incorporating by reference this proxy statement into any filing under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, except to the extent that Monadnock Community Bancorp specifically
incorporates this report by reference, and shall not otherwise be deemed filed
with the Securities and Exchange Commission.

This report has been provided by the audit committee.

Thomas C. LaFortune, Chairman
Kenneth R. Simonetta
Edward J. Shea
Samuel J. Hackler
Kenneth A. Christian
Jack Goldstein

Section 16(a) Beneficial Ownership Reporting Compliance

The common stock of Monadnock Community Bancorp is registered pursuant to
Section 12(g) of the Securities Exchange Act of 1934, as amended. The officers
and directors of Monadnock Community Bancorp and beneficial owners of greater
than 10% of the common stock of Monadnock Community Bancorp ("10% beneficial
owners") are required to file reports on Forms 3, 4 and 5 with the Securities
and Exchange Commission disclosing beneficial ownership and changes in
beneficial ownership of the common stock of Monadnock Community Bancorp.
Securities and Exchange Commission rules require disclosure in a company's
annual proxy statement and annual report on Form 10-KSB of the failure of an
officer, director or 10% beneficial owner of the common stock to file a Form 3,
4 or 5 on a timely basis. Based on Monadnock Community Bancorp's review of such
ownership reports, except for Monadnock Mutual Holding Company's initial
statement of beneficial ownership on Form 3, no officer, director or 10%
beneficial owner of Monadnock Community Bancorp failed to file such ownership
reports on a timely basis for the fiscal year ended December 31, 2004.

Compensation Committee Interlocks and Insider Participation

The compensation committee is comprised of independent directors within
the meaning of the Nasdaq corporate governance listing standards. The
compensation committee consists of the following directors Kenneth A. Christian,
who serves as chairman, Thomas C. LaFortune, Kenneth R. Simonetta, Edward J.
Shea, Samuel J. Hackler and Jack Goldstein. Under the board's policies, Mr.
Pierce, and any other director who is also an executive officer of Monadnock
Community Bancorp and Monadnock Community Bank, will not participate in the
board of directors determination of compensation for their respective offices.

Executive Compensation

The following table sets forth for the fiscal years ended December 31,
2004 and 2003, certain information as to the total remuneration paid by
Monadnock Community Bank to Mr. Pierce, who serves as President and Chief
Executive Officer, and is the only officer to receive annual compensation in
excess of $100,000. Summary compensation information is excluded for the year
ended December 31, 2002, as Monadnock Community Bancorp was not a public
company.

Annual Compensation Long-Term Compensation
-------------------------------- ------------------------------
Awards Payouts
-------------------- ------- All
Other Other
Year Annual Restricted Compen-
Name and Ended Compen- Stock Option/ LTIP sation
Principal Position 12/31 Salary Bonus sation (1) Awards (#) SARS (#) Payouts (2)
- ---------------------- ----- -------- --------- ---------- ---------- -------- ------- -------

William M. Pierce, Jr. 2004 $116,834 $ -- -- -- -- $ -- $1,681
President and 2003 103,947 -- -- -- -- -- 3,100
Chief Executive Officer

- ----------
(1) For the fiscal years ended December 31, 2004 and 2003, there were no
perquisites exceeding the lesser of $50,000 or 10% of Mr. Pierce's total
salary and bonus for the year.
(2) Amount represents matching contributions under Monadnock Community Bank's
Simple IRA Plan for Mr. Pierce.

Directors Compensation

Members of the board of directors and the committees of Monadnock
Community Bancorp do not receive separate compensation for their service on the
board of directors or the committees of Monadnock Community Bancorp.

For the fiscal year ended December 31, 2004, non-employee members of
Monadnock Community Bank's board of directors received a fee of $150 per regular
board meeting attended and the chairman of the board of directors received a fee
of $500 per meeting month and an additional $250 for each meeting attended over
two per month. Committee members are not separately compensated for attending
committee meetings. The same fee schedule is expected to be used again in 2005.

Benefits

General. Monadnock Community Bank currently provides health and welfare
benefits to its employees, including hospitalization and comprehensive medical
insurance, life insurance, subject to deductibles and co-payments by employees
and an employee stock ownership plan. Prior to the completion of Monadnock
Community Bank's mutual holding company reorganization in June 2004, Monadnock
Community Bank maintained a qualified, tax-exempt savings plan known as a
Savings Incentive Match Plan for Employees of Small Employers ("Simple IRA")
with a cash or deferred feature qualifying under Section 408(p) of the Internal
Revenue Code. In connection with the adoption of the employee stock ownership
plan, the Simple IRA was discontinued in June 2004.

Transactions With Certain Related Persons

Monadnock Community Bank has a policy of granting loans to officers and
directors, which fully complies with all applicable federal regulations. Loans
to directors and executive officers are made in the ordinary course of business
and on the same terms and conditions as those of comparable transactions with
unaffiliated third parties prevailing at the time, in accordance with our
underwriting guidelines, and do not involve more than the normal risk of
collectibility or present other unfavorable features. In addition, all loans to
directors and executive officers are approved by at least a majority of the
independent, disinterested members of the board.

All loans Monadnock Community Bank makes to its directors and executive
officers are subject to regulations restricting loans and other transactions
with affiliated persons of Monadnock Community Bank. Loans to all directors and
executive officers and their associates totaled approximately $297,622 at
December 31, 2004, which was 5.7% of our stockholders' equity at that date. All
loans to directors and executive officers were performing in accordance with
their terms at December 31, 2004.

Equity Compensation Plan Information

As of December 31, 2004, Monadnock Community Bancorp did not have any
equity compensation plans under which Monadnock Community Bancorp's common stock
was authorized for issuance.

PROPOSAL II - APPROVAL OF THE MONADNOCK COMMUNITY BANCORP
2005 STOCK OPTION PLAN

General

Subject to stockholder approval at the annual meeting of stockholders,
Monadnock Community Bancorp has established the Monadnock Community Bancorp 2005
Stock Option Plan (the "Stock Option Plan"). Pursuant to the Stock Option Plan,
options to purchase up to 46,041 shares of common stock may be granted to
Monadnock Community Bank's and Monadnock Community Bancorp's employees and
directors. As of March 14, 2005, the market value of the common stock was $11.35
per share. The board of directors of Monadnock Community Bancorp believes that
it is appropriate to adopt a flexible and comprehensive stock option plan that
permits the granting of a variety of long-term incentive awards to directors and
employees as a means of enhancing and encouraging the recruitment and retention
of those individuals on whom the continued success of Monadnock Community Bank
and Monadnock Community Bancorp most depends. Attached as Appendix B to this
proxy statement is the complete text of the form of the Stock Option Plan. The
principal features of the Stock Option Plan are summarized below.

The Stock Option Plan complies with the requirements of the Office of
Thrift Supervision and the Office of Thrift Supervision does not endorse or
approve the Stock Option Plan in any manner.

The number of shares to be awarded as a percentage of the shares not held
by Monadnock Mutual Holding Company ("Minority Shares") and as a percentage of
all outstanding shares is as follows:

Number of Shares % of Minority Shares % of Total Outstanding Shares
---------------- -------------------- -----------------------------
46,041 10.89% 4.90%

Principal Features of the Stock Option Plan

The Stock Option Plan provides for awards in the form of stock options
and/or limited stock appreciation rights ("Limited Rights"). Each award shall be
on such terms and conditions, consistent with the Stock Option Plan and
applicable Office of Thrift Supervision regulations, as the committee
administering the Stock Option Plan may determine.

The term of stock options generally will not exceed ten years from the
date of grant. Stock options granted under the Stock Option Plan may be either
"Incentive Stock Options" as defined under Section 422 of the Internal Revenue
Code or stock options not intended to qualify as such. No stock option awards
have been granted to date under the Stock Option Plan.

Shares issued upon the exercise of a stock option may be either authorized
but unissued shares, treasury shares, or shares acquired by Monadnock Community
Bancorp in open market purchases. Any shares of Monadnock Community Bancorp
common stock subject to an award that expires or is terminated unexercised will
again be available for issuance under the Stock Option Plan. Generally, in the
discretion of the board of directors, all or any vested non-qualified stock
options granted under the Stock Option Plan may be transferable by the
participant but only to the persons or classes of persons determined by the
board of directors. No other award or any right or interest therein is
assignable or transferable except under certain limited exceptions set forth in
the Stock Option Plan.

The Stock Option Plan will be administered by a committee (the
"Committee") consisting of either (i) at least two "non-employee directors" (as
defined in the Stock Option Plan) of Monadnock Community Bancorp, or (ii) the
entire board of directors of Monadnock Community Bancorp. The members of the
Committee shall be appointed by the board of directors of Monadnock Community
Bancorp. Pursuant to the terms of the Stock Option Plan, outside directors and
key employees of Monadnock Community Bank, Monadnock Community Bancorp or their
affiliates are eligible to participate. As of December 31, 2004, there were six
non-employee directors eligible to participate in the Stock Option Plan. Subject
to the provisions of the Stock Option Plan and Office of Thrift Supervision
regulations and policy, the Committee will determine to whom the awards will be
granted, in what amounts, and the period over which such awards will vest. Under
Office of Thrift Supervision regulations the vesting amount may not be more than
20% per year. In addition, the aggregate amount of the awards granted to the
directors may not exceed 30% of the shares in the plan, no individual director
may receive more than 5% of the shares in the plan and no employee may receive
more than 25% of the shares in the plan. The Committee may accelerate the time
period for exercising options subject to Office of Thrift Supervision
regulations.

In granting awards under the Stock Option Plan, the Committee will
consider, among other things, position and years of service, and the value of
the individual's services to Monadnock Community Bank and Monadnock Community
Bancorp. The exercise price of stock options will be at least the fair market
value of the underlying common stock at the time of the grant. Once granted,
stock options may not be re-priced (i.e., the exercise price may not be changed
other than adjustments for stock splits, stock dividends and similar events).
The exercise price may be paid in cash, common stock, or via a broker-assisted
"cashless exercise" (as defined in the Stock Option Plan).

Stock Options. Incentive stock options can only be granted to employees of
Monadnock Community Bank, Monadnock Community Bancorp or an "affiliate" (i.e., a
parent or subsidiary corporation of Monadnock Community Bank and Monadnock
Community Bancorp). Outside directors will be granted non-qualified stock
options. No option granted to an officer in connection with the Stock Option
Plan will be exercisable as an incentive stock option subject to incentive tax
treatment if exercised more than three months after the date on which the
optionee terminates employment with Monadnock Community Bank and/or Monadnock
Community Bancorp, except as set forth below. In the event a participant ceases
to maintain continuous service with Monadnock Community Bancorp or an affiliate
by reason of death, disability or following a change in control, options still
subject to restrictions will vest and be free of these restrictions and can be
exercised for up to one year after

cessation of service but in no event beyond the expiration of the options'
original term. In the event a participant ceases to maintain continuous service
for any other reason, the participant will forfeit all nonvested options. The
participant's vested options will remain exercisable for up to three months in
the case of incentive stock options, and one year in the case of non-qualified
stock options. If an optionee terminates employment with Monadnock Community
Bank, Monadnock Community Bancorp or an affiliate, any incentive stock options
exercised more than three months following the date the optionee terminates
employment shall be treated as a non-qualified stock option; provided, however,
that in the event of death or disability, incentive stock options may be
exercised and receive incentive tax treatment for up to at least one year
following termination of employment, subject to the requirements of the Internal
Revenue Code.

In the event of death or disability of an optionee, Monadnock Community
Bancorp, if requested by the optionee or beneficiary, may elect, in exchange for
the option, to pay the optionee or beneficiary the amount by which the fair
market value of the common stock exceeds the exercise price of the option on the
date of the optionee's termination of service for death or disability.

Limited Stock Appreciation Rights. The Committee may grant Limited Rights
(as defined in the Stock Option Plan) to employees simultaneously with the grant
of any option. A Limited Right gives the option holder the right, upon a change
in control of Monadnock Community Bancorp or Monadnock Community Bank, to
receive the excess of the market value of the shares represented by the Limited
Rights on the date exercised over the exercise price. Limited Rights generally
will be subject to the same terms and conditions and exercisable to the same
extent as stock options, as described above. Payment upon exercise of a Limited
Right will be in shares of Monadnock Community Bancorp common stock. Limited
rights are only exercisable if Monadnock Community Bancorp is traded on an
established securities market.

Limited Rights may be granted at the time of, and must be related to, the
grant of a stock option. The exercise of one will reduce to that extent the
number of shares represented by the other. If a Limited Right is granted with
and related to an incentive stock option, the Limited Right must satisfy all the
restrictions and limitations to which the related incentive stock option is
subject.

Effect of Adjustments. Shares as to which awards may be granted under the
Stock Option Plan, and shares then subject to awards, will be adjusted by the
Committee in the event of any merger, consolidation, reorganization,
recapitalization, stock dividend, stock split, combination or exchange of shares
or other change in the corporate structure of Monadnock Community Bancorp
without receipt of payment or consideration by Monadnock Community Bancorp.

In the case of any merger, consolidation or combination of Monadnock
Community Bancorp with or into another holding company or other entity, whereby
holders of common stock will receive a cash payment (the "Merger Price") for
each share of common stock exchanged in the transaction, any individual with
exercisable options will receive an amount equal to the difference between the
Merger Price times the number of shares of common stock subject to such options
and the aggregate exercise price of all surrendered options.

Amendment and Termination. The board of directors of Monadnock Community
Bancorp may at any time amend, suspend or terminate the Stock Option Plan or any
portion thereof, provided, however, that no such amendment, suspension or
termination shall impair the rights of any individual, without his consent, in
any award made pursuant to the plan. Unless previously terminated, the Stock
Option Plan shall continue in effect for a term of ten years, after which no
further awards may be granted under the Stock Option Plan.

Federal Income Tax Consequences. The following brief description of the
tax consequences of stock option grants under the Stock Option Plan is based on
federal income tax laws currently in effect and does not purport to be a
complete description of such federal income tax consequences.

The exercise of a stock option which is an "Incentive Stock Option" within
the meaning of Section 422 of the Internal Revenue Code will generally not, by
itself, result in the recognition of taxable income to the individual nor
entitle Monadnock Community Bancorp to a deduction at the time of such exercise.
However, the difference between the exercise price and the fair market value of
the option shares on the date of exercise is an adjustment to alternative
minimum taxable income which may, in certain situations, trigger the alternative
minimum tax. The

alternative minimum tax is incurred only when it exceeds the regular income tax.
The disposition of an Incentive Stock Option share prior to the end of the
applicable holding period (i.e., the longer of two years from the date of grant
or one year from the date of exercise) will cause any gain to be taxed at
ordinary income tax rates, with respect to the spread between the exercise price
and the fair market value of the share on the date of exercise and at applicable
capital gains rates with respect to any post exercise appreciation in the value
of the share.

The exercise of a non-qualified stock option will result in the
recognition of ordinary income on the date of exercise in an amount equal to the
difference between the exercise price and the fair market value of the shares on
the date of exercise.

The exercise of a Limited Right will result in the recognition of ordinary
income by the individual on the date of exercise equal to the fair market value
of the shares acquired pursuant to the exercise.

Monadnock Community Bancorp will be allowed a deduction at the time, and
in the amount of, any ordinary income recognized by the individual under the
various circumstances described above, provided that Monadnock Community Bancorp
meets its federal withholding tax obligations.

The affirmative vote of (x) a majority of the votes eligible to be cast at
the annual meeting and (y) a majority of the votes cast at the annual meeting by
stockholders other than Monadnock Mutual Holding Company (without regard to
broker non-votes or proxies marked "ABSTAIN") is required for the approval of
the Monadnock Community Bancorp 2005 Stock Option Plan.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE STOCK
OPTION PLAN.

PROPOSAL III - APPROVAL OF THE MONADNOCK COMMUNITY BANCORP
2005 RECOGNITION AND RETENTION PLAN

General

Subject to stockholder approval at the annual meeting of stockholders,
Monadnock Community Bancorp has established the Monadnock Community Bancorp 2005
Recognition and Retention Plan (the "Recognition Plan") as a method of providing
certain key employees and outside directors of Monadnock Community Bancorp and
Monadnock Community Bank with a proprietary interest in Monadnock Community
Bancorp in a manner designed to encourage such persons to remain with Monadnock
Community Bancorp and/or Monadnock Community Bank, and to provide further
incentives to achieve corporate objectives. The following discussion is
qualified in its entirety by reference to the Recognition Plan, the text of
which is attached hereto as Appendix C.

Monadnock Community Bancorp intends to contribute stock or sufficient
funds for the Recognition Plan to acquire 18,416 shares of common stock of
Monadnock Community Bancorp, which will be available to be awarded to key
employees and outside directors of Monadnock Community Bancorp. It is expected
that such shares will be purchased in the open market, although authorized but
unissued shares and treasury shares may be used. No stock awards have been
granted to date under the Recognition Plan.

The Recognition Plan complies with the requirements of the Office of
Thrift Supervision and the Office of Thrift Supervision does not endorse or
approve the Plan in any manner.

The number of shares to be awarded as a percentage of the Minority Shares
and as a percentage of all outstanding shares is as follows:

Number of Shares % of Minority Shares % of Total Outstanding Shares
---------------- -------------------- -----------------------------
18,416 4.36% 1.96%

Principal Features of the Recognition Plan

The Recognition Plan provides for the award of shares of common stock
("Recognition Plan Shares") subject to the restrictions described below. As of
March 14, 2005, the market value of the common stock was $11.35 per share. Each
award under the Recognition Plan will be made on terms and conditions consistent
with the Recognition Plan.

The Recognition Plan will be administered by a committee (the
"Committee"), which shall be appointed by the board of directors of Monadnock
Community Bancorp and shall consist of either (i) at least two "non-employee
directors" (as defined in the Recognition Plan) of Monadnock Community Bancorp
or (ii) the entire board of directors of Monadnock Community Bancorp. The
Committee will select the recipients and terms of awards pursuant to the
Recognition Plan. Pursuant to the terms of the Recognition Plan, any director or
key employee of Monadnock Community Bank, Monadnock Community Bancorp or its
affiliates may be selected by the Committee to participate in the Recognition
Plan. In determining to whom and in what amount to grant awards, the Committee
will consider the position and responsibilities of eligible persons, the value
of their services to Monadnock Community Bancorp and Monadnock Community Bank
and other factors it deems relevant. As of December 31, 2004, there were six
non-employee directors eligible to participate in the Recognition Plan.

The Committee will determine the period during which or at the expiration
of which the shares awarded as restricted stock vest. Under Office of Thrift
Supervision regulations the vesting amount may not be more than 20% per year. In
addition, the aggregate amount of the awards granted to the directors may not
exceed 30% of the shares in the plan, no individual director may receive more
than 5% of the shares in the plan and no employee may receive more than 25% of
the shares in the plan. In its discretion, the Committee may accelerate the time
at which any or all of the restrictions will lapse, or to remove any or all of
such restrictions, whenever it may determine that such action is appropriate by
reason of changes in applicable tax or other laws or other changes in
circumstances occurring after the commencement of such restricted period.
Subject to the above restrictions, in the event a recipient ceases to maintain
continuous service with Monadnock Community Bancorp or Monadnock Community Bank
by reason of death or disability or following a change in control, the
Recognition Plan Shares still subject to restrictions ("restricted stock") will
vest and be free of these restrictions. In the event of termination for any
other reason, all nonvested restricted stock will be forfeited. Prior to vesting
of the nonvested restricted stock, a recipient will have the right to vote the
nonvested restricted stock, which has been awarded to the recipient and will
receive any dividends declared on such nonvested restricted stock. Nonvested
restricted stock is subject to forfeiture if the recipient fails to remain in
the continuous service (as defined in the Recognition Plan) as an employee,
officer, or director of Monadnock Community Bancorp or Monadnock Community Bank
for the restricted period.

Effect of Adjustments. Restricted stock awarded under the Recognition Plan
will be adjusted by the Committee in the event of a reorganization,
recapitalization, stock split, stock dividend, combination or exchange of
shares, merger, consolidation or other change in corporate structure.

Federal Income Tax Consequences. Holders of restricted stock will
recognize ordinary income on the date that the shares of restricted stock are no
longer subject to a substantial risk of forfeiture, in an amount equal to the
fair market value of the shares on that date. In certain circumstances, a holder
may elect to recognize ordinary income and determine such fair market value on
the date of the grant of the restricted stock. Holders of restricted stock will
also recognize compensation income (or in the case of non-employee directors,
self employment income) equal to their dividend payments when such payments are
received. Generally, the amount of income recognized by individuals will be a
deductible expense for tax purposes by Monadnock Community Bancorp.

Amendment to the Recognition Plan. The board of directors of Monadnock
Community Bancorp may at any time amend, suspend or terminate the Recognition
Plan or any portion thereof, provided, however, that no such amendment,
suspension or termination shall impair the rights of any award recipient,
without his consent, in any award therefore made pursuant to the Recognition
Plan.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE
RECOGNITION PLAN.

PROPOSAL IV - RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS

Shatswell, MacLeod & Company, P.C. currently serves as the company's
independent auditors, and that firm has conducted the audit of the company's
accounts for fiscal 2004. The Sarbanes-Oxley Act of 2002 requires the Audit
Committee of the Board of Directors to be directly responsible for the
appointment, compensation, and oversight of the audit work of the independent
auditors. Therefore, the Audit Committee appointed Shatswell, MacLeod & Company,
P.C. as the company's auditors for the 2005 fiscal year, subject to the
ratification of the engagement by the company's stockholders. A representative
of Shatswell, MacLeod & Company, P.C., is expected to attend the meeting to
respond to appropriate questions and to make a statement if he so desires.

Set forth below is certain information concerning aggregate fees billed
for professional services rendered by Shatswell, MacLeod & Company, P.C., during
the fiscal years ended December 31, 2003 and December 31, 2004.

The aggregate fees included in the audit category were fees billed for the
fiscal years for the audit of Monadnock Community Bancorp's annual financial
statements and the review of Monadnock Community Bancorp's quarterly financial
statements. The aggregate fees included in each of the other categories were
fees billed in the noted fiscal years.

2004 2003
-------- -------
Audit Fees $126,283 $30,918
Audit-Related Fees $ -- $ --
Tax Fees $ 3,500 $ 3,500
All Other Fees $ -- $ --

Audit Fees. Audit fees of $30,918 in fiscal year 2003 were for
professional services rendered for the audit of the financial statements of
Monadnock Community Bank, a mutual savings association. Audit fees of $126,283
in fiscal 2004 were for the audit of the consolidated financial statements of
Monadnock Community Bancorp. The audit fees for fiscal 2004 includes fees
relating to Monadnock Community Bancorp's initial public offering, review of the
financial statements included in Monadnock Community Bancorp's quarterly reports
on Form 10-QSB and the internal controls attestation required under SEC
regulations.

Tax Fees. Tax fees of $3,500 in fiscal year 2004 and $3,500 in fiscal year
2003 were for services related to tax compliance and tax planning.

The audit committee has considered whether the provision of non-audit
services, which relate primarily to tax consulting services rendered, is
compatible with maintaining the independence of Shatswell, MacLeod & Company,
P.C. The audit committee concluded that performing such services does not affect
the independence of Shatswell, MacLeod & Company, P.C. in performing its
function as auditor of Monadnock Community Bancorp.

The audit committee's policy is to pre-approve all audit and non-audit
services provided by the independent auditors. These services may include audit
services, audit-related services, tax services and other services. The audit
committee has delegated pre-approval authority to its chairman when expedition
of services is necessary. The independent auditors and management are required
to periodically report to the full audit committee regarding the extent of
services provided by the independent auditors in accordance with this
pre-approval, and the fees for the services performed to date. The tax fees paid
in fiscal year 2004 were for services commenced prior to the implementation of
the audit committee's pre-approval policies.

In order to ratify the selection of Shatswell, MacLeod & Company, P.C. as
the auditors for the fiscal year ending December 31, 2005, the proposal must
receive at least a majority of the votes cast, without regard to broker
non-votes, either in person or by proxy, in favor of such ratification. The
audit committee of the board of directors

recommends a vote "FOR" the ratification of Shatswell, MacLeod & Company, P.C.
as the independent auditors for the fiscal year ending December 31, 2005.

ADVANCE NOTICE OF BUSINESS TO BE CONDUCTED
AT AN ANNUAL MEETING

The bylaws of Monadnock Community Bancorp provide an advance notice
procedure for certain business, or nominations to the board of directors, to be
brought before an annual meeting. For business to be properly brought before an
annual meeting by a stockholder, the stockholder must have given timely notice
thereof in writing to the Secretary of Monadnock Community Bancorp. To be timely
a stockholder's notice must be delivered to or mailed and received at the
principal executive offices of Monadnock Community Bancorp no later than five
days before the date of the meeting. A stockholder's notice to the Secretary
shall set forth as to each matter the stockholder proposes to bring before the
annual meeting (a) a brief description of the business desired to be brought
before the annual meeting, (b) the name and address, as they appear on Monadnock
Community Bancorp's books, of the stockholder proposing such business, (c) the
class and number of shares of Monadnock Community Bancorp which are beneficially
owned by the stockholder, and (d) any material interest of the stockholder in
such business. The chairman of an annual meeting may, if the facts warrant,
determine and declare to the meeting that certain business was not properly
brought before the meeting in accordance with the provisions of Monadnock
Community Bancorp's bylaws, and if he should so determine, he shall so declare
to the meeting and any such business not properly brought before the meeting
shall not be transacted. This provision is not a limitation on any other
applicable laws and regulations. Accordingly, advance written notice of business
or nominations to the board of directors to be brought before the 2005 Annual
Meeting of Stockholders must be given to Monadnock Community Bancorp no later
than five days prior to the date of the meeting, as indicated above.

STOCKHOLDER PROPOSALS

In order to be eligible for inclusion in Monadnock Community Bancorp's
proxy materials for Monadnock Community Bancorp's 2006 Annual Meeting of
Stockholders, any stockholder proposal to take action at such meeting must be
received at Monadnock Community Bancorp's executive office, One Jaffrey Road,
Peterborough, New Hampshire 03458, no later than November 24, 2005. Any such
proposals shall be subject to the requirements of the proxy rules adopted under
the Securities Exchange Act of 1934, as amended.

OTHER MATTERS

The board of directors is not aware of any business to come before the
annual meeting other than the matters described above in the proxy statement.
However, if any matters should properly come before the annual meeting, it is
intended that the holders of the proxies will act in accordance with their best
judgment.

MISCELLANEOUS

The cost of solicitation of proxies will be borne by Monadnock Community
Bancorp. Monadnock Community Bancorp will reimburse brokerage firms and other
custodians, nominees and fiduciaries for reasonable expenses incurred by them in
sending proxy materials to the beneficial owners of common stock. In addition to
solicitations by mail, directors, officers and regular employees of Monadnock
Community Bancorp may solicit proxies personally or by telegraph or telephone
without additional compensation. Monadnock Community Bancorp's 2004 Annual
Report to Stockholders has been mailed to all stockholders of record as of March
14, 2005. Any stockholder who has not received a copy of such annual report may
obtain a copy by writing Monadnock Community Bancorp at the address below. Such
annual report is not to be treated as a part of the proxy solicitation material
nor as having been incorporated herein by reference.

HOUSEHOLDING OF PROXY STATEMENTS AND ANNUAL REPORTS

Monadnock Community Bancorp intends to deliver only one annual report and
proxy statement to multiple registered stockholders sharing the same address
unless it has received contrary instructions from one or more of the

stockholders. If individual stockholders wish to receive a separate copy of the
annual report or proxy statement they may call or write and request separate
copies currently or in the future as follows:

Stockholder Relations
Monadnock Community Bancorp, Inc.
One Jaffrey Road
Peterborough, New Hampshire 03458
Phone: (603) 924-9654
Fax: (603) 924-9379

Registered stockholders sharing the same address and receiving multiple copies
of annual reports or proxy statements may request the delivery of a single copy
by writing or calling the above address or phone number.

BY ORDER OF THE BOARD OF DIRECTORS

/s/ Thomas C. LaFortune

Thomas C. LaFortune
Secretary

Peterborough, New Hampshire
March 24, 2005

Appendix A

MONADNOCK COMMUNITY BANCORP, INC.

AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

CHARTER

PREAMBLE

This Audit Committee Charter (the "Charter") has been adopted by the Board of
Directors of Monadnock Community Bancorp, Inc. (the "Company"). The Audit
Committee of the Board shall review and reassess this Charter annually and
recommend any proposed changes to the Board for approval.

OBJECTIVES OF COMMITTEE

o To provide assistance to the Board of Directors in fulfilling its
fiduciary responsibilities to oversee management's activities
relating to accounting, record keeping, financial reporting,
internal controls, disclosure controls and internal control over
financial reporting.

o Provide a vehicle and establish a forum for the free and open
communication of views and information among the Company's
directors, independent public accounting firm, internal auditor and
management.

o To review the independence of the Company's independent public
accounting firm and the objectivity of internal auditor.

o To review the adequacy and reliability of disclosures to
stockholders.

o To perform the audit committee functions specified by the Securities
and Exchange Commission and the NASDAQ.

o To establish and maintain a system for confidential complaints
regarding the Company's accounting, financial reporting, internal
controls, disclosure controls, and internal control over financial
reporting.

o The committee's duties do not include planning or conducting
external or internal audits or determining that the Company's
financial statements are complete, accurate and in accordance with
generally accepted accounting principles. Nor is it the duty of the
committee to assure compliance with laws and regulations. These are
the responsibilities of management.

A-1

ROLES AND RESPONSIBILITIES

The responsibilities of the committee include the following:

Independent Auditors:

o Appoint an independent public accounting firm for the purpose of
auditing the Company's financial statements and, if and when
required, attesting to its internal controls.

o Assess the qualifications of the Company's public auditing firm and
its lead engagement partner. Oversee and evaluate the performance of
such person and firm; if necessary, remove them.

o Obtain annually from the Company's independent public auditing firm
a formal written statement describing all relationships between the
firm and the Company, consistent with Independence Standards Board
Standard Number 1. Discuss with the Company's independent public
auditing firm any relationships that may impact the objectivity and
independence of such firm and take, or recommend that the Board
take, appropriate actions with respect to the independence of such
firm from the Company.

o Resolve any disagreements between management and the Company's
independent public auditing firm regarding accounting, financial
reporting, disclosure controls, internal control over financial
reporting and similar matters.

o Approve, in advance, all audit and non-audit services to be
performed for the Company by its independent public auditing firm,
subject to applicable law and regulation. Negotiate and approve all
fees and engagement terms of the Company's independent public
auditing firm for audit and non-audit services.

o Obtain assurance from the Company's independent public auditing firm
that Section 10A(b) of the Exchange Act has not been implicated.

o Review with the Company's independent public auditing firm the plan,
procedures and scope of its annual audit of the Company's financial
statements.

Financial Reporting Review:

o Review at least annually critical accounting policies, alternate
treatments within GAAP and significant assumptions and estimates
with respect to the Company's financial statements with its
management and independent public auditing firm. In connection with
such review, review the financial accounting and reporting
treatments preferred by the Company's independent auditing firm.

A-2

o Review and discuss the Company's audited financial statements with
management and the Company's independent public auditing firm
including all of the matters indicated in Statement of Auditing
Standards Number 61. Based on such review, recommend to the board
whether such audited financial statements should be included in the
Company's Annual Report on Form 10-KSB and Annual Report to
Stockholders for the relevant fiscal year.

o Review material written communications between the Company's
independent public auditing firm and management including the
management letter and schedule of unadjusted differences.

o Review and discuss with management and Company's independent public
auditing firm on at least an annual basis the Company's disclosure
of off-balance sheet data and non-financial data.

o Review and discuss with management and the Company's independent
public auditing firm the appropriateness (and the reconciliation to
GAAP) of any pro forma data to be included in the Company's public
financial reports.

o Review and discuss with management and the Company's independent
public auditing firm prior to release any proposed earnings
announcement or financial press release.

o Review and discuss with management and the Company's independent
public auditing firm prior to filing the Company's Annual Reports on
Form 10-KSB, Quarterly Reports on Form 10-QSB and any other SEC
disclosure filings.

o Monitor the efforts of management and the Company's independent
public auditors to cure any deficiencies noted in its financial
statements or accounting process.

Internal Controls, Disclosure Controls and Internal Control over Financial
Reporting:

o Oversee the selection, compensation and performance of the Company's
internal auditor. Assess the qualifications and independence of the
Company's internal auditor.

o Discuss with the Company's management, independent public auditing
firm and internal auditor the organization, scope, objectivity,
budget and staffing of the Company's internal audit.

o Determine that no restrictions are placed upon the scope of the
internal audit. Assess reports regarding computer systems,
facilities and backup systems.

o Review regulatory examination reports and internal audit reports and
monitor management's compliance efforts.

A-3

o Review with the Company's independent public auditing firm, internal
auditor and management, the adequacy and effectiveness of the
Company's internal controls (including internal control over
financial reporting) and disclosure controls.

o Review reports of management and the Company's independent public
auditing firm on internal and quality controls including, if and
when required by applicable law or regulations, management's report
and the independent public auditing firm's attestation on internal
control over financial reporting.

o Discuss with management on a quarterly basis its review and
conclusions regarding the Company's disclosure controls and whether
there have been any changes in the Company's internal control over
financial reporting.

Other:

o Discuss the Company's legal and regulatory compliance with the
Company's Chief Compliance Officer on at least an annual basis.

o Review and, to the extent required under applicable SEC and NASDAQ
rules, approve all transactions with related parties.

o Establish procedures for (a) the receipt, retention and treatment of
any complaints received by the Company on accounting, financial
reporting, internal control, internal control over financial
reporting, or auditing matters and (b) the confidential, anonymous
submission by the Company's employees of concerns regarding
questionable accounting, financial reporting, internal controls,
internal control over financial reporting and auditing matters.

o Reassess the adequacy of this Charter at least annually.

ORGANIZATION

o The committee shall consist of a minimum of three outside directors
of the Company. All members must be (i) financially literate, (ii)
able to read and understand financial statements and (iii) able to
satisfy applicable NASDAQ and SEC requirements with respect thereto.
In addition, at least one member of the committee shall have past
employment experience in finance or accounting, requisite
professional certification in accounting, or any other comparable
experience or background which results in such member's financial
sophistication, (including being or having been a chief executive
officer, chief financial officer or other senior officer with
financial oversight responsibilities.)

o All members of the committee must be free from any relationship with
the Company which would interfere with their independent judgement.
Other than in his or her capacity as a member of the board of
directors or any committee

A-4

thereof, no audit committee member shall accept directly or
indirectly any fee or other compensation from the Company or any
subsidiary and no audit committee member may be an affiliated person
of the Company. No audit committee member or any of his family
members shall have been employed by the Company, its independent
public auditing firm or any of their affiliates or, received any
payments from the Company (except as set forth above), its
independent public accounting firm or any of their affiliates over
the last three years. All audit committee members must comply with
the independence requirements of the NASDAQ and the SEC.

o Required Meetings. The committee shall meet at least four times a
year and more frequently as circumstances require. The timing of
meetings shall be determined by the committee. However, at least
once per year, the committee shall have private meetings with each
of the Company's independent public auditing firm, management and
the internal auditor.

o One member of the committee shall be appointed as chairman. The
chairman shall be responsible for leadership of the committee,
including scheduling and presiding over meetings, preparing agendas,
and making regular reports to the board. The chairman will also
maintain regular liaison with the Company's President and Chief
Executive Officer, Chief Financial Officer, the lead partner of its
independent public auditing firm, the internal auditor and any
general counsel.

o The committee shall have the power to conduct or authorize
investigations into any matters within its scope of
responsibilities. The committee is empowered to engage independent
counsel and such other advisers as it determines necessary or
appropriate to carry out its duties. The Company shall pay all
expenses of such advisers and any other expenses that are necessary
or appropriate for carrying out the committee's duties.

A-5

Appendix B

MONADNOCK COMMUNITY BANCORP, INC.
2005 STOCK OPTION PLAN

1. Purpose

The purpose of the Monadnock Community Bancorp, Inc. 2005 Stock Option
Plan (the "Plan") is to advance the interests of Monadnock Community Bancorp,
Inc. (the "Company") and its stockholders by providing Key Employees and Outside
Directors of the Company and its Affiliates, including Monadnock Community Bank
(the "Bank"), upon whose judgment, initiative and efforts the successful conduct
of the business of the Company and its Affiliates largely depends, with an
additional incentive to perform in a superior manner as well as to attract
people of experience and ability.

2. Definitions

"Affiliate" means any "parent corporation" or "subsidiary corporation" of
the Company or the Bank, as such terms are defined in Section 424(e) or 424(f),
respectively, of the Code, or a successor to a parent corporation or subsidiary
corporation.

"Award" means an Award of Non-Statutory Stock Options, Incentive Stock
Options, or Limited Rights granted under the provisions of the Plan.

"Bank" means Monadnock Community Bank, or a successor corporation.

"Beneficiary" means the person or persons designated by a 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, his/her estate.

"Board" or "Board of Directors" means the board of directors of the
Company, unless otherwise noted herein.

"Cause" means personal dishonesty, incompetence, 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) or a final cease-and-desist
order, any of which results in a material loss to the Company or an Affiliate.

B-1

Nominating Committee serving under an Incumbent Board, shall be, for purposes of
this clause (b), considered as though he/she were a member of the Incumbent
Board; or (c) a plan of reorganization, merger, consolidation, sale of all or
substantially all the assets of the Bank or the Company or similar transaction
occurs in which the Bank or Company is not the surviving institution; or (d) a
proxy statement soliciting proxies from stockholders of the Company, by someone
other than the current management of the Company, seeking stockholder approval
of a plan of reorganization, merger or consolidation of the Company or similar
transaction with one or more corporations as a result of which the outstanding
shares of the class of securities then subject to the Plan are to be exchanged
for or converted into cash or property or securities not issued by the Company;
or (e) a tender offer is made for 25% or more of the voting securities of the
Company and the stockholders owning beneficially or of record 25% or more of the
outstanding securities of the Company have tendered or offered to sell their
shares pursuant to such tender offer and such tendered shares have been accepted
by the tender offeror.

"Code" means the Internal Revenue Code of 1986, as amended.

"Committee" means the committee consisting of either (i) at least two
Non-Employee Directors of the Company, or (ii) the entire Board of the Company.

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

"Company" means Monadnock Community Bancorp, Inc., the stock holding
company of the Bank, or a successor corporation.

"Continuous Service" means employment as a Key Employee and/or service as
an Outside Director without any interruption or termination of such employment
and/or service. Continuous Service shall also mean a continuation as a member of
the Board of Directors following a cessation of employment as a Key Employee or
continuation of service as a Director Emeritus following termination of service
as a Director. In the case of a Key Employee, employment shall not be considered
interrupted in the case of sick leave, military leave or any other approved
leave of absence or in the case of transfers between payroll locations of the
Company, its subsidiaries or its successor.

"Date of Grant" means the actual date on which an Award is granted by the
Committee.

"Director" means a member of the Board.

"Director Emeritus" means a former member of the Board who has been
appointed to a Director Emeritus position.

"Disability" means the inability to engage in any substantial gainful
activity by reason of any medically determinable mental or physical impairment
which can be expected to result in death or which lasted or can be expected to
last for a continuous period of not less than 12 months. An individual shall not
be considered to be permanently and totally disabled unless he furnishes proof
of the existence thereof in such form and manner, and at such times, as the
Secretary of the Treasury may require, in accordance with Section 22(e)(3) of
the Code.

"Effective Date" means the date of, or a date determined by the Board of
Directors following, approval of the Plan by the Company's stockholders.

"Fair Market Value" means, when used in connection with the Common Stock
on a certain date, the mean between the highest and lowest quoted selling prices
of the Common Stock as reported on the Nasdaq stock market (or over-the-counter
market) on such date, or if the Common Stock was not traded on such date, then
on the day prior to such date or on the next preceding day on which the Common
Stock was traded; provided, however, that if the Common Stock is not reported on
the Nasdaq

B-2

stock market (or over the counter market), Fair Market Value shall mean the
average sale price of all shares of Common Stock sold during the 30-day period
immediately preceding the date on which such stock option was granted, and if no
shares of stock have been sold within such 30-day period, the average sale price
of the last three sales of Common Stock sold during the 90-day period
immediately preceding the date on which such stock option was granted. In the
event Fair Market Value cannot be determined in the manner described above, then
Fair Market Value shall be determined by the Committee. The Committee is
authorized, but is not required, to obtain an independent appraisal to determine
the Fair Market Value of the Common Stock.

"Incentive Stock Option" means an Option granted by the Committee to a Key
Employee, which Option is designated as an Incentive Stock Option pursuant to
Section 9.

"Key Employee" means any person who is currently employed by the Company
or an Affiliate who is chosen by the Committee to participate in the Plan.

"Limited Right" means the right to receive a number of shares of Common
Stock based upon the terms set forth in Section 10.

"Non-Employee Director" means, for purposes of the Plan, a Director who
(a) is not employed by the Company or an Affiliate; (b) does not receive
compensation directly or indirectly as a consultant (or in any other capacity
than as a Director) greater than $60,000; (c) does not have an interest in a
transaction requiring disclosure under Item 404(a) of Regulation S-B; or (d) is
not engaged in a business relationship for which disclosure would be required
pursuant to Item 404(b) of Regulation S-B.

"Non-Statutory Stock Option" means an Option granted by the Committee to
(i) an Outside Director or (ii) any other Participant and such Option is either
(a) not designated by the Committee as an Incentive Stock Option, or (b) fails
to satisfy the requirements of an Incentive Stock Option as set forth in Section
422 of the Code and the regulations thereunder.

"OTS" means the Office of Thrift Supervision.

"Option" means an Award granted under Section 8 or Section 9

"Outside Director" means a Director of the Company or an Affiliate who is
not an employee of the Company or an Affiliate.

"Participant" means a Key Employee or Outside Director of the Company or
its Affiliates who receives or has received an Award under the Plan.

"Right" means a Limited Right.

"Termination for Cause" means the termination of employment or termination
of service on the Board caused by the individual's 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), or a final cease
and desist order, any of which results in material loss to the Company or one of
its Affiliates.

3. Administration of the Plan

(a) Role of the Committee. The Plan shall be administered by the
Committee. The interpretation and construction by the Committee of any
provisions of the Plan or of any Option 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 and
subject to OTS regulations

B-3

and policy, the Committee may adopt such rules and procedures as it deems
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.

(b) Role of the Board. The members of the Committee shall be appointed or
approved by, and will serve at the pleasure of, the Board of Directors of the
Company. The Board may in its discretion from time to time remove members from,
or add members to, the Committee. The Board shall have all of the powers
allocated to it in the Plan, may take any action under or with respect to the
Plan that the Committee is authorized to take, and may reverse or override any
action taken or decision made by the Committee under or with respect to the
Plan.

(c) Plan Administration Restrictions. All transactions involving a grant,
award or other acquisitions from the Company shall:

(i) be approved by the Company's full Board or by the Committee;

(ii) be approved, or ratified, in compliance with Section 14 of the
Exchange Act, by either: the affirmative vote of the holders of a
majority of the shares present, or represented and entitled to
vote at a meeting duly held in accordance with the laws under
which the Company is incorporated; or the written consent of the
holders of a majority of the securities of the issuer entitled to
vote, provided that such ratification occurs no later than the
date of the next annual meeting of stockholders; or

(iii) result in the acquisition of Common Stock that is held by the
Recipient for a period of six months following the date of such
acquisition.

(d) Limitation on Liability. No member of the Board or the Committee shall
be liable for any determination made in good faith with respect to the Plan or
any Awards granted under it. If a member of the Board or the Committee 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 or the Company shall indemnify such
member against expense (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with
such action, suit or proceeding if he/she acted in good faith and in a manner
he/she reasonably believed to be in the best interests of the Bank and the
Company and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his/her conduct was unlawful.

Notwithstanding anything herein to the contrary, and subject to any
adjustment that may be made pursuant to Section 16 hereof, once an Option has
been awarded at Fair Market Value, the Committee shall not have authority to
reprice such Option so that the exercise price of the Option shall be less than
the exercise price on the Date of Grant.

4. Types of Awards

Awards under the Plan may be granted in any one or a combination of: (a)
Incentive Stock Options; (b) Non-Statutory Stock Options, and (c) Limited
Rights.

5. Stock Subject to the Plan

Subject to adjustment as provided in Section 16 the maximum number of
shares reserved for issuance under the Plan is 46,041 shares. Shares issued
under the Plan may be issued by the Company from authorized but unissued shares,
treasury shares, or acquired by the Company in open market

B-4

purchases. The maximum number of Options that may be awarded to a Key Employee
is 11,510 shares. The maximum aggregate number of shares of Common Stock that
may be issued pursuant to the exercise of Incentive Stock Options is 46,041
shares. For these purposes, only the net number of shares issued pursuant to the
exercise of an Incentive Stock Option are counted against the maximum number of
shares.

To the extent that Options or Rights granted under the Plan are exercised,
the shares covered will be unavailable for future grants under the Plan; to the
extent that Options together with any related Rights granted under the Plan
terminate, expire or are forfeited without having been exercised or, in the case
of Limited Rights exercised for cash, new Awards may be made with respect to
these shares.

Any shares that are issued by the Company, and any Awards that are granted
by, or become obligations of, the Company, through the assumption by the Company
or an affiliate thereof, or in substitution for, outstanding Awards previously
granted by an acquired company, shall not be counted against the shares
available for issuance under the Plan.

6. Eligibility

Key Employees of the Company and its Affiliates shall be eligible to
receive Incentive Stock Options, Non-Statutory Stock Options, and Limited Rights
under the Plan. Outside Directors shall be eligible to receive Non-Statutory
Stock Options under the Plan.

7. General Terms and Conditions of Options and Rights

(a) The Committee shall have full and complete authority and discretion,
subject to OTS regulations and policy and except as expressly limited by the
Plan, to grant Options and/or Rights and to provide the terms and conditions
(which need not be identical among Participants) thereof. In particular, the
Committee shall prescribe the following terms and conditions: (i) the Exercise
Price of any Option or Right, which shall not be less than the Fair Market Value
per share on the Date of Grant, (ii) the number of shares of Common Stock
subject to, and the expiration date of, any Option or Right, which expiration
date shall not exceed ten years from the Date of Grant, (iii) the manner, time
and rate (cumulative or otherwise) of exercise of such Option or Right, and (iv)
the restrictions, if any, to be placed upon such Option or Right or upon shares
of Common Stock which may be issued upon exercise of such Option or Right.

(b) The following provisions shall apply to all Awards made under this
Plan: no individual officer shall be granted Awards with respect to more than
25% of the total shares (or 11,510 shares) subject to the Plan; no Outside
Director shall be granted Awards with respect to more than 5% of the total
shares of Common Stock subject to the Plan; all Outside Directors in the
aggregate may not be granted Awards with respect to more than 30% of the total
shares of Common Stock subject to the Plan; no Awards shall begin vesting
earlier than one year from the date the Plan is approved by stockholders of the
Company; and no Awards shall vest at a rate in excess of 20% per year beginning
one year from the Date of Grant.

(c) Notwithstanding any provision of this Plan to the contrary, all
executive officers or directors must exercise or forfeit their Awards in the
event that the Bank becomes critically undercapitalized (as defined in 12 C.F.R.
ss.565.4), becomes subject to enforcement action by the OTS, or receives a
capital direction from the OTS pursuant to 12 C.F.R. ss.565.7.

(d) The Company, or its designee, shall timely furnish to individuals in
the Plan following the individual's exercise of an Incentive Stock Option a
written information statement containing the information set forth in Treasury
Regulation Section 1.6039-1(a).

B-5

8. Non-Statutory Stock Options

The Committee may, from time to time, grant Non-Statutory Stock Options to
eligible Key Employees and Outside Directors. Non-Statutory Stock Options
granted under the Plan, including Non-Statutory Stock Options granted in
exchange for and upon surrender of previously granted Awards, are subject to the
terms and conditions set forth in this Section.

(a) Option Agreement. Each Option shall be evidenced by a written option
agreement between the Company and the Participant specifying the number of
shares of Common Stock that may be acquired through its exercise and containing
such other terms and conditions that are not inconsistent with the terms of the
Plan.

(b) Price. The purchase price per share of Common Stock deliverable upon
the exercise of each Non-Statutory Stock Option shall be the Fair Market Value
of the Common Stock of the Company on the Date of Grant. Shares may be purchased
only upon full payment of the purchase price in one or more of the manners set
forth in Section 12 hereof, as determined by the Committee.

(c) Vesting. Subject to Section 7(b) hereof, a Non-Statutory Stock Option
granted under the Plan shall vest in a Participant at the rate or rates
determined by the Committee. No Options shall become vested in a Participant
unless the Participant maintains Continuous Service until the vesting date of
such Option, except as set forth herein. The Committee may, subject to OTS
regulations and policy, accelerate the time at which any Non-Statutory Stock
Option may be exercised in whole or in part.

(d) Exercise of Options. A vested Option may be exercised from time to
time, in whole or in part, by delivering a written notice of exercise to the
President or Chief Executive Officer of the Company, or his/her designee. Such
notice shall be irrevocable and must be accompanied by full payment of the
purchase price in cash or shares of Common Stock at the Fair Market Value of
such shares, determined on the exercise date in the manner described in Section
2 hereof. If previously acquired shares of Common Stock are tendered in payment
of all or part of the exercise price, the value of such shares shall be
determined as of the date of such exercise.

(e) Amount of Awards. Subject to Section 7(b) hereof, Non-Statutory Stock
Options may be granted to any Key Employee or Outside Director in such amounts
as determined by the Committee. In granting Non-Statutory Stock Options, the
Committee shall consider such factors as it deems relevant, which factors may
include, among others, the position and responsibility of the Key Employee or
Outside Director, the length and value of his/her service to the Bank, the
Company or the Affiliate, the compensation paid to the Key Employee or Outside
Director, and the Committee's evaluation of the performance of the Bank, the
Company or the Affiliate, according to measurements that may include, among
others, key financial ratios, level of classified assets and independent audit
findings.

(f) Term of Options. Unless the Committee determines otherwise, the term
during which Non-Statutory Stock Options may be exercised shall not exceed ten
years from the Date of Grant. In no event shall a Non-Statutory Stock Option be
exercisable in whole or in part more than ten years from the Date of Grant.

(g) Termination of Continuous Service. Upon the termination of a Key
Employee's or Outside Director's Continuous Service, for any reason other than
death, Disability, Termination for Cause, termination following a Change in
Control (other than for Cause following a Change in Control), the Participant's
Non-Statutory Stock Options shall be exercisable only as to those shares that
were vested on the date of termination and only for one year following
termination. In the event of Termination for Cause, all rights under a
Participant's Non-Statutory Stock Options shall expire upon termination. In the
event of the Participant's termination of Continuous Service due to death,
Disability, or following a Change in Control, all Non-Statutory Stock Options
held by the Participant, whether or not vested at such

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time, shall vest and become exercisable by the Participant or his/her legal
representative or beneficiaries for one year following the date of such
termination, death or cessation of employment or service, provided that in no
event shall the period extend beyond the expiration of the Non-Statutory Stock
Option term.

(h) Transferability. In the discretion of the Board, all or any
Non-Statutory Stock Option granted hereunder may be transferable by the
Participant once the Option has vested in the Participant, provided, however,
that the Board may limit the transferability of such Option or Options to a
designated class or classes of persons.

9. Incentive Stock Options

The Committee may, from time to time, grant Incentive Stock Options to Key
Employees. Incentive Stock Options granted pursuant to the Plan shall be subject
to the following terms and conditions:

(a) Option Agreement. Each Option shall be evidenced by a written option
agreement between the Company and the Key Employee specifying the number of
shares of Common Stock that may be acquired through its exercise and containing
such other terms and conditions that are consistent with the terms of the Plan.

(b) Price. Subject to Section 16 hereof and Section 422 of the Code, the
purchase price per share of Common Stock deliverable upon the exercise of each
Incentive Stock Option shall be not less than 100% of the Fair Market Value of
the Company's Common Stock on the date the Incentive Stock Option is granted.
However, if a Key Employee owns stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company or its Affiliates
(or under Section 424(d) of the Code is deemed to own stock representing more
than 10% of the total combined voting power of all classes of stock of the
Company or its Affiliates by reason of the ownership of such classes of stock,
directly or indirectly, by or for any brother, sister, spouse, ancestor or
lineal descendent of such Key Employee, or by or for any corporation,
partnership, estate or trust of which such Key Employee is a stockholder,
partner or Beneficiary), the purchase price per share of Common Stock
deliverable upon the exercise of each Incentive Stock Option shall not be less
than 110% of the Fair Market Value of the Company's Common Stock on the date the
Incentive Stock Option is granted. Shares may be purchased only upon payment of
the full purchase price. Payment of the purchase price may be made, in whole or
in part, through the surrender of shares of the Common Stock of the Company at
the Fair Market Value of such shares determined on the exercise date.

(c) Vesting. Subject to Section 7(b) hereof, Incentive Stock Options
awarded to Key Employees shall vest at the rate or rates determined by the
Committee. No Incentive Stock Option shall become vested in a Participant unless
the Participant maintains Continuous Service until the vesting date of such
Option, except as set forth herein.

(d) Exercise of Options. Vested Options may be exercised from time to
time, in whole or in part, by delivering a written notice of exercise to the
President or Chief Executive Officer of the Company, or his/her designee. Such
notice is irrevocable and must be accompanied by full payment of the exercise
price in cash or shares of Common Stock at the Fair Market Value of such shares
determined on the exercise date.

The Options comprising each installment may be exercised in whole or in
part at any time after such installment becomes vested, provided that the amount
able to be first exercised in a given year is consistent with the terms of
Section 422 of the Code. To the extent required by Section 422 of the Code, the
aggregate Fair Market Value (determined at the time the Option is granted) of
the Common Stock for

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which Incentive Stock Options are exercisable for the first time by a
Participant during any calendar year (under all plans of the Company and its
Affiliates) shall not exceed $100,000.

The Committee may, in its sole discretion and subject to OTS regulations
and policy, accelerate the time at which any Incentive Stock Option may be
exercised in whole or in part, provided that it is consistent with the terms of
Section 422 of the Code. Notwithstanding the above, in the event of a Change in
Control of the Company, all Incentive Stock Options that have been awarded shall
become immediately exercisable, provided, however, that if the aggregate Fair
Market Value (determined at the time the Option is granted) of Common Stock for
which Options are exercisable as a result of a Change in Control, together with
the aggregate Fair Market Value (determined at the time the Option is granted)
of all other Common Stock for which Incentive Stock Options become exercisable
during such year, exceeds $100,000, then the first $100,000 of Incentive Stock
Options (determined as of the Date of Grant) shall be exercisable as Incentive
Stock Options and any excess shall be exercisable as Non-Statutory Stock Options
(but shall remain subject to the provisions of this Section to the extent
permitted).

(e) Amounts of Awards. Subject to Section 7(b) hereof, Incentive Stock
Options may be granted to any eligible Key Employee in such amounts as
determined by the Committee; provided that the amount granted is consistent with
the terms of Section 422 of the Code. In granting Incentive Stock Options, the
Committee shall consider such factors as it deems relevant, which factors may
include, among others, the position and responsibilities of the Key Employee,
the length and value of his/her service to the Bank, the Company, or the
Affiliate, the compensation paid to the Key Employee and the Committee's
evaluation of the performance of the Bank, the Company, or the Affiliate,
according to measurements that may include, among others, key financial ratios,
levels of classified assets, and independent audit findings. The provisions of
this subsection (e) shall be construed and applied in accordance with Section
422(d) of the Code and the regulations, if any, promulgated thereunder.

(f) Terms of Options. The term during which each Incentive Stock Option
may be exercised shall be determined by the Committee, provided, however, in no
event shall an Incentive Stock Option be exercisable in whole or in part more
than 10 years from the Date of Grant. If any Key Employee, at the time an
Incentive Stock Option is granted to him, owns stock representing more than 10%
of the total combined voting power of all classes of stock of the Company or its
Affiliate (or, under Section 424(d) of the Code, is deemed to own stock
representing more than 10% of the total combined voting power of all classes of
stock, by reason of the ownership of such classes of stock, directly or
indirectly, by or for any brother, sister, spouse, ancestor or lineal descendent
of such Key Employee, or by or for any corporation, partnership, estate or trust
of which such Key Employee is a stockholder, partner or Beneficiary), the
Incentive Stock Option granted to him shall not be exercisable after the
expiration of five years from the Date of Grant.

(g) Termination of Continuous Service. Upon the termination of a Key
Employee's Continuous Service for any reason other than death, Disability,
Termination for Cause or termination following a Change in Control (other than
for Cause following a Change in Control) the Key Employee's Incentive Stock
Options shall be exercisable only as to those shares that were vested by such
Key Employee at the date of termination for a period of three months following
termination. Upon termination of a Key Employee's Continuous Service due to
death or Disability or following a Change in Control, all Incentive Options held
by a Key Employee, whether or not vested at such time, shall vest and become
exercisable by the Participant or his/her legal representative or beneficiaries
for one year following the date of such termination, death or cessation of
Continuous Service, provided that in no event shall the period extend beyond the
expiration of the Stock Option term, and provided, further, that, except in the
event of death or Disability, such Option shall not be eligible for treatment as
an Incentive Stock Option in the event such Option is exercised more than three
months following termination. In the event of Termination for Cause, all rights
under the Incentive Stock Options shall expire upon termination.

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In order to obtain Incentive Stock Option treatment for Options exercised
by heirs or devisees of an Optionee, the Optionee's death must have occurred
while employed or within three months of termination of Continuous Service.

(h) Transferability. No Incentive Stock Option granted under the Plan is
transferable except by will or the laws of descent and distribution and is
exercisable during his/her lifetime only by the Key Employee to which it is
granted.

(i) Compliance with Code. The options granted under this Section are
intended to qualify as Incentive Stock Options within the meaning of Section 422
of the Code, but the Company makes no warranty as to the qualification of any
Option as an Incentive Stock Option within the meaning of Section 422 of the
Code. If an Option granted hereunder fails for whatever reason to comply with
the provisions of Section 422 of the Code, and such failure is not or cannot be
cured, such Option shall be a Non-Statutory Stock Option.

10. Limited Rights

The Committee may grant a Limited Right simultaneously with the grant of
any Option to any Key Employee of the Bank or the Company, with respect to all
or some of the shares covered by such Option. Limited Rights granted under the
Plan are subject to the following terms and conditions:

(a) Terms of Rights. In no event shall a Limited Right be exercisable in
whole or in part before the expiration of six months from the date of grant of
the Limited Right. A Limited Right may be exercised only in the event of a
Change in Control of the Company.

The Limited Right may be exercised only when the underlying Option is
eligible to be exercised, provided that the Fair Market Value of the underlying
shares on the day of exercise is greater than the exercise price of the related
Option.

Upon exercise of a Limited Right, the related Option shall cease to be
exercisable. Upon exercise or termination of an Option, any related Limited
Rights shall terminate. The Limited Rights may be for no more than 100% of the
difference between the exercise price and the Fair Market Value of the Common
Stock subject to the underlying Option. The Limited Right is transferable only
when the underlying Option is transferable and under the same conditions.

(b) Payment. Upon exercise of a Limited Right, the holder shall promptly
receive from the Company a number of shares of Common Stock equal in value to
the difference between the Fair Market Value of the Common Stock on the Date of
Grant of the Limited Right and the Fair Market Value of the Common Stock on the
date the Limited Right is exercised, multiplied by the number of Limited Rights
being exercised. In no event shall a Limited Right be settled other than in
shares of Common Stock.

(c) Notwithstanding anything in this paragraph 10 to the contrary, in no
event shall a Limited Right be exercisable in whole or in part if the Common
Stock is not traded on an established securities market.

11. Surrender of Option

In the event of a Participant's termination of employment or termination
of service as a result of death or Disability, the Participant (or his/her
personal representative(s), heir(s), or devisee(s)) may, in a form acceptable to
the Committee, make application to surrender all or part of the Options held by
such Participant in exchange for a cash payment from the Company of an amount
equal to the difference between the Fair Market Value of the Common Stock on the
date of termination of employment or the date of termination of service on the
Board and the exercise price per share of the Option. Whether the

B-9

Company accepts such application or determines to make payment, in whole or
part, is within its absolute and sole discretion, it being expressly understood
that the Company is under no obligation to any Participant whatsoever to make
such payments. In the event that the Company accepts such application and
determines to make payment, such payment shall be in lieu of the exercise of the
underlying Option and such Option shall cease to be exercisable.

12. Alternate Option Payment Mechanism

The Committee has sole discretion to determine what form of payment it
will accept for the exercise of an Option. The Committee may indicate acceptable
forms in the agreement with the Participant covering such Options or may reserve
its decision to the time of exercise. No Option is to be considered exercised
until payment in full is accepted by the Committee or its agent.

(a) Cash Payment. The exercise price may be paid in cash or by certified
check. To the extent permitted by law, the Committee may permit all or a portion
of the exercise price of an Option to be paid through borrowed funds.

(b) Cashless Exercise. Subject to vesting requirements, if applicable, a
Participant may engage in a "cashless exercise" of the Option. Upon a cashless
exercise, the Participant shall give the Company written notice of the exercise
of the Option together with an order to a registered broker-dealer or equivalent
third party, to sell part or all of the Common Stock subject to the Option and
to deliver enough of the proceeds to the Company to pay the Option exercise
price and any applicable withholding taxes. If the Participant does not sell the
Common Stock subject to the Option through a registered broker-dealer or
equivalent third party, the Participant may give the Company written notice of
the exercise of the Option and the third party purchaser of the Common Stock
subject to the Option shall pay the Option exercise price plus applicable
withholding taxes to the Company.

(c) Exchange of Common Stock. The Committee may permit payment of the
Option exercise price by the tendering (or constructively tendering) of
previously acquired shares of Common Stock. All shares of Common Stock tendered
in payment of the exercise price of an Option shall be valued at the Fair Market
Value of the Common Stock. No tendered shares of Common Stock which were
acquired by the Participant upon the previous exercise of an Option or as awards
under a stock award plan (such as the Company's Recognition and Retention Plan)
shall be accepted for exchange unless the Participant has held such shares
(without restrictions imposed by said plan or award) for at least six months
prior to the exchange.

13. Rights of a Stockholder

A Participant shall have no rights as a stockholder with respect to any
shares covered by a Non-Statutory and/or Incentive Stock Option until the date
of issuance of a stock certificate for such shares. Nothing in the Plan or in
any Award granted confers on any person any right to continue in the employ of
the Company or its Affiliates or to continue to perform services for the Company
or its Affiliates or interferes in any way with the right of the Company or its
Affiliates to terminate his/her services as an officer, director or employee at
any time.

14. Agreement with Participants

Each Award of Options and Limited Rights will be evidenced by a written
agreement, executed by the Participant and the Company or its Affiliates that
describes the conditions for receiving the Awards, including the date of Award,
the purchase price, applicable periods, and any other terms and conditions as
may be required by the Board or applicable securities laws.

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15. Designation of Beneficiary

A Participant may, with the consent of the Committee, designate a person
or persons to receive, in the event of death, any Option or Limited Rights to
which he/she would then be entitled. Such designation will be made upon forms
supplied by and delivered to the Company and may be revoked in writing. If a
Participant fails effectively to designate a Beneficiary, then his/her estate
will be deemed to be the Beneficiary.

16. Dilution and Other Adjustments

In the event of any change in the outstanding shares of Common Stock by
reason of any stock dividend or split, pro rata return of capital to all
stockholders, recapitalization, or any merger, consolidation, spin-off,
reorganization, combination or exchange of shares, or other similar corporate
change, or other increase or decrease in such shares, without receipt or payment
of consideration by the Company, the Committee will make such adjustments to
previously granted Awards, to prevent dilution or enlargement of the rights of
the Participant, including any or all of the following:

(a) adjustments in the aggregate number or kind of shares of Common Stock
that may be awarded under the Plan;

(b) adjustments in the aggregate number or kind of shares of Common Stock
covered by Awards already made under the Plan; or

(c) adjustments in the purchase price of outstanding Incentive and/or
Non-Statutory Stock Options, or any Limited Rights attached to such Options.

No such adjustments may, however, materially change the value of benefits
available to a Participant under a previously granted Award. With respect to
Incentive Stock Options, no such adjustment shall be made if it would be deemed
a "modification" of the Award under Section 424 of the Code.

17. Effect of a Change in Control on Option Awards

In the event of a Change in Control, the Committee and the Board of
Directors will take one or more of the following actions to be effective as of
the date of such Change in Control:

(a) provide that such Options shall be assumed, or equivalent options
shall be substituted ("Substitute Options") by the acquiring or succeeding
corporation (or an affiliate thereof), provided that: (1) any such Substitute
Options exchanged for Incentive Stock Options shall meet the requirements of
Section 424(a) of the Code, and (2) the shares of stock issuable upon the
exercise of such Substitute Options shall be registered in accordance with the
Securities Act of 1933, as amended ("1933 Act") or such securities shall be
exempt from such registration in accordance with Sections 3(a)(2) or 3(a)(5) of
the 1933 Act, (collectively, "Registered Securities"), or in the alternative, if
the securities issuable upon the exercise of such Substitute Options shall not
constitute Registered Securities, then the Participant will receive upon
consummation of the Change in Control a cash payment for each Option surrendered
equal to the difference between the (1) fair market value of the consideration
to be received for each share of Common Stock in the Change in Control times the
number of shares of Common Stock subject to such surrendered Options, and (2)
the aggregate exercise price of all such surrendered Options; or

(b) in the event of a transaction under the terms of which the holders of
Common Stock will receive upon consummation thereof a cash payment (the "Merger
Price") for each share of Common Stock exchanged in the Change in Control
transaction, make or provide for a cash payment to the Participants equal to the
difference between (1) the Merger Price times the number of shares of Common

B-11

Stock subject to such Options held by each Participant (to the extent then
exercisable at prices not in excess of the Merger Price), and (2) the aggregate
exercise price of all such surrendered Options.

18. Withholding

There may be deducted from each distribution of cash and/or Common Stock
under the Plan the minimum amount of any federal or state taxes, including
payroll taxes, that are applicable to such supplemental taxable income and that
are required by any governmental authority to be withheld. Shares of Common
Stock will be withheld where required from any distribution of Common Stock.

19. Amendment of the Plan

The Board may at any time, and from time to time, modify or amend the Plan
in any respect, or modify or amend an Award received by Key Employees and/or
Outside Directors; provided, however, that no such termination, modification or
amendment may affect the rights of a Participant, without his/her consent, under
an outstanding Award.

20. Effective Date of Plan

The Plan shall become effective upon the date of approval of the Plan by
the Company's stockholders.

21. Termination of the Plan

The right to grant Awards under the Plan will terminate upon the earlier
of (i) 10 years after the Effective Date, or (ii) the date on which the exercise
of Options or related rights equaling the maximum number of shares reserved
under the Plan occurs. The Board may suspend or terminate the Plan at any time,
provided that no such action will, without the consent of a Participant,
adversely affect his/her rights under a previously granted Award.

22. Applicable Law

(a) This Plan, the Awards, all documents evidencing Awards and all other
related documents shall be governed by, and will be construed and administered
in accordance with the laws of the State of New Hampshire, except to the extent
that federal law shall apply.

(b) This Plan is subject to the requirements of 12 C.F.R. Part 575,
including the requirements of section 575.8 and the applicable requirements of
section 563b.500. Notwithstanding any other provision in this Plan, no shares of
Common Stock shall be issued with respect to any Award to the extent that such
issuance would cause Monadnock Mutual Holding Company to fail to qualify as a
mutual holding company under applicable federal regulations.

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Appendix C

MONADNOCK COMMUNITY BANCORP, INC.
2005 RECOGNITION AND RETENTION PLAN

1. Establishment of the Plan; Creation of Separate Trust

(a) Monadnock Community Bancorp, Inc. (the "Company") hereby establishes
the Monadnock Community Bancorp, Inc. 2005 Recognition and Retention Plan (the
"Plan") upon the terms and conditions hereinafter stated in the Plan.

(b) A separate trust or trusts may be established to purchase shares of
the Common Stock that will be awarded hereunder (the "Trust"). If a trust is
established and a Recipient hereunder fails to satisfy the conditions of the
Plan and forfeits all or any portion of the Common Stock awarded to him/her,
such forfeited shares will be returned to said Trust. If no trust is
established, forfeited shares shall be cancelled or held in treasury as
determined by the Committee.

2. Purpose of the Plan

The purpose of the Plan is to advance the interests of Monadnock Community
Bank (the "Bank") and the Company and the Company's stockholders by providing
Key Employees and Outside Directors of the Company and its Affiliates, including
the Bank, upon whose judgment, initiative and efforts the successful conduct of
the business of the Company and its Affiliates largely depends, with
compensation for their contributions to the Company and its Affiliates and an
additional incentive to perform in a superior manner, as well as to attract
people of experience and ability.

3. 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
meanings set forth below. Wherever appropriate, the masculine pronoun shall
include the feminine pronoun and the singular shall include the plural:

"Affiliate" means any "parent corporation" or "subsidiary corporation" of
the Company or the Bank, as such terms are defined in Section 424(e) and (f),
respectively, of the Code, or a successor to a parent corporation or subsidiary
corporation.

"Award" means the grant by the Committee of Restricted Stock, as provided
in the Plan.

"Bank" means Monadnock Community Bank, or a successor corporation.

"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.

"Board" or "Board of Directors" means the Board of Directors of the
Company, unless otherwise noted.

"Cause" means 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

C-1

regulation (other than traffic violations or similar offenses) or a final
cease-and-desist order, any of which results in a material loss to the Company
or an Affiliate.

"Change in Control" of the Bank or the Company means a change in control
of a nature that: (i) would be required to be reported in response to Item 5.01
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 Home Owners' Loan Act, as amended ("HOLA"), and applicable rules
and regulations promulgated thereunder, as in effect at the time of the Change
in Control; or (iii) 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 Company representing 25% or more of the
combined voting power of Company's outstanding securities except for any
securities purchased by the Company's employee stock ownership plan or trust; 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/she were a member of the Incumbent Board; or (c) a plan of reorganization,
merger, consolidation, sale of all or substantially all the assets of the Bank
or the Company or similar transaction occurs in which the Bank or Company is not
the surviving institution; or (d) a proxy statement soliciting proxies from
stockholders of the Company, by someone other than the current management of the
Company, seeking stockholder approval of a plan of reorganization, merger or
consolidation of the Company or similar transaction with one or more
corporations as a result of which the outstanding shares of the class of
securities then subject to the Plan are to be exchanged for or converted into
cash or property or securities not issued by the Company; or (e) a tender offer
is made for 25% or more of the voting securities of the Company and the
stockholders owning beneficially or of record 25% or more of the outstanding
securities of the Company have tendered or offered to sell their shares pursuant
to such tender offer and such tendered shares have been accepted by the tender
offeror.

"Code" means the Internal Revenue Code of 1986, as amended.

"Committee" means the committee of the Board of the Company consisting of
either (i) at least two Non-Employee Directors of the Company, or (ii) the
entire Board of the Company.

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

"Company" means Monadnock Community Bancorp, Inc., the stock holding
company of the Bank, or a successor corporation.

"Continuous Service" means employment as a Key Employee and/or service as
an Outside Director without any interruption or termination of such employment
and/or service. Continuous Service shall also mean a continuation as a member of
the Board of Directors following a cessation of employment as a Key Employee or
continuation of service as a Director Emeritus following termination of service
as a Director. In the case of a Key Employee, employment shall not be considered
interrupted in the case of sick leave, military leave or any other leave of
absence approved by the Bank or in the case of transfers between payroll
locations of the Bank or between the Bank, its parent, its subsidiaries or its
successor.

"Director" means a member of the Board.

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"Director Emeritus" means a former member of the Board who has been
appointed by the Board to a Director Emeritus position.

"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/her, or of a Director or Outside Director to serve as such.
Additionally, in the case of an employee, a medical doctor selected or approved
by the Board 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 such employee's
lifetime.

"Effective Date" means the date of, or a date determined by the Board
following, approval of the Plan by the Company's stockholders.

"Key Employee" means any person who is currently employed by the Company
or an Affiliate who is chosen by the Committee to participate in the Plan.

"OTS" means the Office of Thrift Supervision.

"Outside Director" means a Director of the Company or an Affiliate who is
not an employee of the Company or an Affiliate.

"Recipient" means a Key Employee or Outside Director of the Company or its
Affiliates who receives or has received an Award under the Plan.

"Restricted Period" means the period of time selected by the Committee for
the purpose of determining when restrictions are in effect under Section 6 with
respect to Restricted Stock awarded under the Plan.

"Restricted Stock" means shares of Common Stock that have been
contingently awarded to a Recipient by the Committee subject to the restrictions
referred to in Section 6, so long as such restrictions are in effect.

4. Administration of the Plan

(a) Role of the Committee. The Plan shall be administered by the
Committee. The interpretation and construction by the Committee of any
provisions of the Plan or of any 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 and
subject to OTS regulations and policy, the Committee may adopt such rules and
procedures as it deems 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.

C-3

the powers allocated to it in the Plan, may take any action under or with
respect to the Plan that the Committee is authorized to take, and may reverse or
override any action taken or decision made by the Committee under or with
respect to the Plan, provided, however, that except as provided in Section 6(b),
the Board may not revoke any Award except in the event of revocation for Cause.

(c) Plan Administration Restrictions. All transactions involving a grant,
award or other acquisitions from the Company shall:

(i) be approved by the Company's full Board or by the Committee;

(iii) result in the acquisition of Common Stock that is held by the
Recipient for a period of six months following the date of such
acquisition.

(d) Limitation on Liability. No member of the Board or the Committee shall
be liable for any determination made in good faith with respect to the Plan or
any Awards granted under it. If a member of the Board or the Committee 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/her in such
capacity under or with respect to the Plan, the Bank or the Company shall
indemnify such member against expense (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by him/her
in connection with such action, suit or proceeding if he/she acted in good faith
and in a manner he/she reasonably believed to be in the best interests of the
Bank and the Company and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful.

5. Eligibility; Awards

(a) Eligibility. Key Employees and Outside Directors are eligible to
receive Awards.

(b) Awards to Key Employees and Outside Directors. The Committee may
determine which of the Key Employees and Outside Directors referenced in Section
5(a) will be granted Awards and the number of shares covered by each Award;
provided, however, that in no event shall any Awards be made that will violate
the Bank's Charter and Bylaws, the Company's Charter and Bylaws, or any
applicable federal or state law or regulation. Shares of Restricted Stock that
are awarded by the Committee shall, on the date of the Award, be registered in
the name of the Recipient and transferred to the Recipient, in accordance with
the terms and conditions established under the Plan. The aggregate number of
shares that shall be issued under the Plan is 18,416 shares. Awards issued under
the Plan may be issued by the Company from authorized but unissued shares,
treasury shares or shares acquired by the Company in open market purchases.

(c) The following provisions shall apply to all Awards made under this
plan: no individual officer shall be granted Awards with respect to more than
25% of the total shares subject to the Plan; no Outside Director shall be
granted Awards of more than 5% of the total shares of Common Stock subject to
the Plan; all Outside Directors in the aggregate may not be granted Awards with
respect to more than

C-4

30% of the total shares of Common Stock subject to the Plan; no Awards shall
begin vesting earlier than one year from the date the Plan is approved by
stockholders of the Company; and no Awards shall vest at a rate in excess of 20%
per year beginning one year from the Date of Grant.

(d) In the event Restricted Stock is forfeited for any reason, the
Committee, from time to time, may determine which of the Key Employees and
Outside Directors will be granted additional Awards to be awarded from forfeited
Restricted Stock.

(e) In selecting those Key Employees and Outside Directors to whom Awards
will be granted and the amount of Restricted Stock covered by such Awards, the
Committee shall consider such factors as it deems relevant, including among
others, the position and responsibilities of the Key Employees and Outside
Directors, the length and value of their services to the Company and its
Affiliates, the compensation paid to the Key Employees or fees paid to the
Outside Directors, and the Committee may request the written recommendation of
the Chief Executive Officer and other senior executive officers of the Bank, the
Company and its Affiliates or the recommendation of the full Board. All
allocations by the Committee shall be subject to review, and approval or
rejection, by the Board.

No Restricted Stock shall be vested unless the Recipient maintains
Continuous Service with the Company or an Affiliate until the restrictions
lapse.

(f) Manner of Award. As promptly as practicable after a determination is
made pursuant to Section 5(b) to grant an Award, the Committee shall notify the
Recipient in writing of the grant of the Award, the number of shares of
Restricted Stock covered by the Award, and the terms upon which the Restricted
Stock subject to the Award may be vested. Upon notification of an Award of
Restricted Stock, the Recipient shall execute and return to the Company a
restricted stock agreement (the "Restricted Stock Agreement") setting forth the
terms and conditions under which the Recipient shall earn the Restricted Stock,
together with a stock power or stock powers endorsed in blank. Thereafter, the
Recipient's Restricted Stock and stock power shall be deposited with an escrow
agent specified by the Company ("Escrow Agent") who shall hold such Restricted
Stock under the terms and conditions set forth in the Restricted Stock
Agreement. Each certificate in respect of shares of Restricted Stock Awarded
under the Plan shall be registered in the name of the Recipient.

(g) Treatment of Forfeited Shares. In the event shares of Restricted Stock
are forfeited by a Recipient, such shares shall be returned to the Company and
shall be held and accounted for pursuant to the terms of the Plan until such
time as the Restricted Stock is re-awarded to another Recipient, in accordance
with the terms of the Plan and the applicable state and federal laws, rules and
regulations.

6. Terms and Conditions of Restricted Stock

The Committee shall have full and complete authority, subject to Section
5(c) and the other limitations of the Plan, to grant awards of Restricted Stock
to Key Employees and Outside Directors and, in addition to the terms and
conditions contained in Sections 6(a) through 6(h), to provide such other terms
and conditions (which need not be identical among Recipients) in respect of such
Awards, and the vesting thereof, as the Committee shall determine.

(a) General Rules. Subject to Section 5(c) hereof, and to OTS regulations
and policy, Restricted Stock shall be vested by a Recipient at the rate or rates
determined by the Committee, provided that such Recipient maintains Continuous
Service. No shares shall vest in any year in which the Bank is not meeting all
of its fully phased-in capital requirements. Subject to any such other terms and
conditions as the Committee shall provide with respect to Awards, shares of
Restricted Stock may not be sold,

C-5

assigned, transferred (within the meaning of Code Section 83), pledged or
otherwise encumbered by the Recipient, except as hereinafter provided, during
the Restricted Period.

(b) Continuous Service; Forfeiture. Except as provided in Section 6(c), if
a Recipient ceases to maintain Continuous Service for any reason, unless the
Committee shall otherwise determine, all shares of Restricted Stock theretofore
awarded to such Recipient and which at the time of such termination of
Continuous Service are subject to the restrictions imposed by Section 6(a) shall
upon such termination of Continuous Service be forfeited. Any stock dividends or
declared but unpaid cash dividends attributable to such shares of Restricted
Stock shall also be forfeited.

(c) Exception for Termination Due to Death or Disability, and Following a
Change in Control. Notwithstanding the general rule contained in Section 6(a),
Restricted Stock awarded to a Recipient whose Continuous Service with the
Company or an Affiliate terminates due to death, Disability, or following a
Change in Control, shall be deemed earned as of the Recipient's last day of
Continuous Service with the Company or an Affiliate.

(d) Revocation for Cause. Notwithstanding anything hereinafter to the
contrary, the Board may by resolution immediately revoke, rescind and terminate
any Award, or portion thereof, previously awarded under the Plan, to the extent
Restricted Stock has not been redelivered by the Escrow Agent to the Recipient,
whether or not yet vested, in the case of a Key Employee whose employment is
terminated by the Company or an Affiliate or an Outside Director whose service
is terminated by the Company or an Affiliate for Cause or who is discovered
after termination of employment or service on the Board to have engaged in
conduct that would have justified termination for Cause.

(e) Restricted Stock Legend. Each certificate in respect of shares of
Restricted Stock awarded under the Plan shall be registered in the name of the
Recipient and deposited by the Recipient, together with a stock power endorsed
in blank, with the Escrow Agent, and shall bear the following (or a similar)
legend:

"The transferability of this certificate and the shares of stock
represented hereby are subject to the terms and conditions (including
forfeiture) contained in the Monadnock Community Bancorp, Inc. 2005
Recognition and Retention Plan. Copies of such Plan are on file in the
offices of the Secretary of Monadnock Community Bancorp, Inc.,
Monadnock Community Plaza, One Jaffrey Road, Peterborough, New
Hampshire 03458."

(f) Payment of Dividends and Return of Capital. After an Award has been
granted but before such Award has been vested, the Recipient shall receive any
cash dividends paid with respect to such shares, or shall share in any pro-rata
return of capital to all stockholders with respect to the Common Stock. Stock
dividends declared by the Company and paid on Awards that have not yet been
vested shall be subject to the same restrictions as the Restricted Stock and the
certificate(s) or other instruments representing or evidencing such shares shall
be legended in the manner provided in Section 6(e) and shall be delivered to the
Escrow Agent for distribution to the Recipient when the Restricted Stock upon
which such dividends were paid are vested. Unless the Recipient has made an
election under Section 83(b) of the Code, cash dividends or other amounts so
paid on shares that have not yet been vested by the Recipient shall be treated
as compensation income to the Recipient when paid. If dividends are paid with
respect to shares of Restricted Stock under the Plan that have been forfeited
and returned to the Company or to a trust established to hold issued and
unawarded or forfeited shares, the Committee can determine to award such
dividends to any Recipient or Recipients under the Plan, to any other employee
or director of the Company or the Bank, or can return such dividends to the
Company.

C-6

(g) Voting of Restricted Shares. After an Award has been granted, the
Recipient as conditional owner of the Restricted Stock shall have the right to
vote such shares.

(h) Delivery of Vested Shares. At the expiration of the restrictions
imposed by Section 6(a), the Escrow Agent shall redeliver to the Recipient (or
where the relevant provision of Section 6(c) applies in the case of a deceased
Recipient, to his Beneficiary) the certificate(s) and any remaining stock power
deposited with it pursuant to Section 5(f) and the shares represented by such
certificate(s) shall be free of the restrictions referred to in Section 6(a).

7. Adjustments upon Changes in Capitalization

In the event of any change in the outstanding shares subsequent to the
Effective Date by reason of any reorganization, recapitalization, stock split,
stock dividend, combination or exchange of shares, or any merger, consolidation
or any change in the corporate structure or shares of the Company, without
receipt or payment of consideration by the Company, the maximum aggregate number
and class of shares as to which Awards may be granted under the Plan shall be
appropriately adjusted by the Committee, whose determination shall be
conclusive. Any shares of stock or other securities received, as a result of any
of the foregoing, by a Recipient with respect to Restricted Stock shall be
subject to the same restrictions and the certificate(s) or other instruments
representing or evidencing such shares or securities shall be legended and
deposited with the Escrow Agent in the manner provided in Section 6(e).

8. Assignments and Transfers

No Award nor any right or interest of a Recipient under the Plan in any
instrument evidencing any Award under the Plan may be assigned, encumbered or
transferred (within the meaning of Code Section 83) except, in the event of the
death of a Recipient, by will or the laws of descent and distribution until such
Award is vested.

9. Key Employee Rights under the Plan

No Key Employee shall have a right to be selected as a Recipient nor,
having been so selected, to be selected again as a Recipient and no Key Employee
or other person shall have any claim or right to be granted an Award under the
Plan or under any other incentive or similar plan of the Company or any
Affiliate. Neither the Plan nor any action taken thereunder shall be construed
as giving any Key Employee any right to be retained in the employ of the Company
or any Affiliate.

10. Outside Director Rights under the Plan

Neither the Plan nor any action taken thereunder shall be construed as
giving any Outside Director any right to be retained in the service of the
Company or any Affiliate.

11. Withholding Tax

Upon the termination of the Restricted Period with respect to any shares
of Restricted Stock (or at any such earlier time that an election is made by the
Recipient under Section 83(b) of the Code, or any successor provision thereto,
to include the value of such shares in taxable income), the Bank or the Company
shall have the right to require the Recipient or other person receiving such
shares to pay the Bank or the Company the minimum amount of any federal or state
taxes, including payroll taxes, that are applicable to such supplemental income
and that the Bank or the Company is required to withhold with respect to such
shares, or, in lieu thereof, to retain or sell without notice, a sufficient
number of shares held by it to cover the amount required to be withheld. The
Bank or the Company shall have the right to

C-7

deduct from all dividends paid with respect to shares of Restricted Stock the
amount of any taxes which the Bank or the Company is required to withhold with
respect to such dividend payments.

12. Amendment or Termination

The Board of the Company may amend, suspend or terminate the Plan or any
portion thereof at any time, provided, however, that no such amendment,
suspension or termination shall impair the rights of any Recipient, without his
consent, in any Award theretofore made pursuant to the Plan. Any amendment or
modification of the Plan or an outstanding Award under the Plan, shall be
approved by the Committee, or the full Board of the Company.

13. Governing Law

14. Term of Plan

The Plan shall become effective on the date of, or a date determined by
the Board of Directors following, approval of the Plan by the Company's
stockholders. It shall continue in effect until the earlier of (i) ten years
from the Effective Date unless sooner terminated under Section 12 hereof, or
(ii) the date on which all shares of Common Stock available for award hereunder,
have vested in the Recipients of such Awards.

C-8

[X]PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE MONADNOCK COMMUNITY BANCORP, INC.

ANNUAL MEETING OF STOCKHOLDERS
May 12, 2005

The undersigned hereby appoints the proxy committee of the board of
directors of Monadnock Community Bancorp, Inc. (the "Company"), with full powers
of substitution to act as attorneys and proxies for the undersigned to vote all
shares of common stock of the Company that the undersigned is entitled to vote
at the 2005 Annual Meeting of Stockholders ("Annual Meeting") to be held at the
RiverMead Auditorium, located at 150 Rivermead Road, Peterborough, New Hampshire
03458, at 10:30 a.m., local time, on May 12, 2005. The proxy committee is
authorized to cast all votes to which the undersigned is entitled as follows:

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

With- For All
For hold Except
1. The election as directors of the nominees listed [_] [_] [_]
below (except as marked to the contrary below) for
a term set forth beside such nominee's name:

William M. Pierce, Jr. (three year term)
Kenneth R. Simonetta (three year term)
Edward J. Shea (one year term)

INSTRUCTION: To withhold authority to vote for any individual nominee, mark "For
All Except"and write that nominee's name in the space provided below.

- --------------------------------------------------------------------------------

For Against Abstain
2. The approval of the Monadnock Community Bancorp, [_] [_] [_]
Inc. 2005 Stock Option Plan.

3. The approval of the Monadnock Community Bancorp, [_] [_] [_]
Inc. 2005 Recognition and Retention Plan.

4. The ratification of the appointment of Shatswell, [_] [_] [_]
MacLeod & Company, P.C. as the independent
auditors for Monadnock Community Bancorp, Inc. for
the fiscal year ending December 31, 2005.

The board of directors recommends a vote "FOR" each of the above-listed
proposals.
- --------------------------------------------------------------------------------
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
PROXY WILL BE VOTED FOR EACH OF THE PROPOSALS STATED ABOVE. IF ANY OTHER
BUSINESS IS PRESENTED AT THE ANNUAL MEETING, THIS PROXY WILL BE VOTED BY THE
MAJORITY OF THE BOARD OF DIRECTORS. AT THE PRESENT TIME, THE BOARD OF DIRECTORS
KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE ANNUAL MEETING.
- --------------------------------------------------------------------------------

PLEASE CHECK THE BOX IF YOU PLAN TO ATTEND THE ANNUAL MEETING. [_]

------------------------
Please be sure to sign and date | Date |
this proxy card in the box below. | |
- --------------------------------------------------------------------------------
| |
| |
- -----------Stockholder sign above----------Co-holder (if any) sign above-------

- --------------------------------------------------------------------------------
Detach above card, date, sign and mail in postage-prepaid envelope provided.

MONADNOCK COMMUNITY BANCORP, INC.

- --------------------------------------------------------------------------------
Should the above signed be present and elect to vote at the Annual Meeting
or at any adjournment thereof and after notification to the Secretary of the
Company at the Annual Meeting of the stockholder's decision to terminate this
proxy, then the power of said attorneys and proxies shall be deemed terminated
and of no further force and effect. This proxy may also be revoked by sending
written notice to the Secretary of the Company at the address set forth on the
Notice of Annual Meeting of Stockholders, or by the filing of a later dated
proxy prior to a vote being taken on a particular proposal at the Annual
Meeting.

The above signed acknowledges receipt from the Company prior to the
execution of this proxy of notice of the Annual Meeting, a proxy statement dated
March 24, 2005, and audited financial statements.

Please sign exactly as your name appears on this proxy card. When signing
as attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder should sign.

PLEASE COMPLETE, SIGN AND DATE THIS PROXY CARD AND
RETURN IT PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE.
- --------------------------------------------------------------------------------

IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED
BELOW AND RETURN THIS PORTION WITH THE PROXY CARD IN THE ENVELOPE PROVIDED.

- --------------------------------------