Exhibit 10.1

Retirement Plan of
the Hudson River Bank and
Trust Company

Effective October 1, 1997

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PREAMBLE

The purpose of this Plan and Trust is to provide, in accordance with its
provisions, a defined benefit pension plan providing retirement and other
related benefits for those Employees of the Employer who are eligible to
participate hereunder.

This document is a complete amendment and restatement of the Retirement Plan of
The Hudson River Bank & Trust Company, which was formerly known as The
Retirement Plan of Hudson City Savings Institution in RSI Retirement Trust,
which was originally effective as of May 1, 1941.

The Plan has been created with the intent that it qualifies for approval under
sections 401 and 410 through 417 of the Internal Revenue Code. The Trust has
been created with the intent that it qualifies for approval under Section 501 of
the Code. It is further intended that the Plan comply with the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA). In case of any
ambiguity in the Plan’s language, it will be interpreted to accomplish the
Plan’s intent of qualifying under the Code and complying with ERISA.

This Plan and Trust is created exclusively for the benefit of the eligible
Employees and their Beneficiaries. Neither the Employer, the Plan Administrator
nor the Trustee will apply or interpret the terms of the Plan in any manner that
permits discrimination in favor of Highly Compensated Employees. All Employees
under similar circumstances will be treated alike.

The terms and conditions of the Plan, as of October 1, 1997 shall, except as
otherwise specifically provided, apply only to Participants who have not retired
or terminated their employment with the Employer as of October 1, 1997. Except
as otherwise specifically provided herein, the right to any benefit under the
Plan with respect to a Participant who retired or terminated employment with the
Employer prior to October 1, 1997, shall be determined in accordance with the
terms of the Plan as in effect at the date of retirement or termination of
employment.

The undersigned Employer and Trustee hereby adopt this restatement of the
Retirement Plan of The Hudson River Bank & Trust Company to be effective as of
October 1, 1997, and agree to be bound by the terms and conditions thereof.

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TABLE OF CONTENTS

 

 

 

 

 

ARTICLE 1 – DEFINITION

 

 

 

 

 

1.01

 

Accrued Benefit

1-1

 

 

 

 

1.02

 

Reserved

1-1

 

 

 

 

1.03

 

Actuarial Equivalent

1-1

 

 

 

 

1.04

 

Affiliated Employer

1-2

 

 

 

 

1.05

 

Average Annual Compensation

1-2

 

 

 

 

1.06

 

Beneficiary

1-2

 

 

 

 

1.07

 

Reserved

1-2

 

 

 

 

1.08

 

Code and ERISA

1-2

 

 

 

 

1.09

 

Compensation

1-2

 

 

 

 

1.10

 

Controlled Group

1-3

 

 

 

 

1.11

 

Reserved

1-3

 

 

 

 

1.12

 

Reserved

1-3

 

 

 

 

1.13

 

Defined Benefit Plan

1-3

 

 

 

 

1.14

 

Defined Contribution Plan

1-3

 

 

 

 

1.15

 

Effective Date

1-3

 

 

 

 

1.16

 

Eligible Employee Classification

1-3

 

 

 

 

1.17

 

Employee

1-3

 

 

 

 

1.18

 

Employer, Plan Sponsor, and Participating Employer

1-4

 

 

 

 

1.19

 

Employment Commencement Date

1-4

 

 

 

 

1.20

 

Entry Date

1-4

 

 

 

 

1.21

 

Reserved

1-4

 

 

 

 

1.22

 

Expected Retirement Benefit

1-4

 

 

 

 

1.23

 

Fiscal Year

1-5

 

 

 

 

1.24

 

Reserved

1-5

 

 

 

 

1.25

 

Highly Compensated Definitions

1-5

 

 

 

 

1.26

 

Reserved

1-6

 

 

 

 

1.27

 

Hour of Service

1-6

 

 

 

 

1.28

 

Reserved

1-7

 

 

 

 

1.29

 

Reserved

1-7

 

 

 

 

1.30

 

Leave of Absence

1-7

 

 

 

 

1.31

 

Limitation Year

1-7

 

 

 

 

1.32

 

Reserved

1-7

 

 

 

 

1.33

 

Normal Retirement Age

1-7

 

 

 

 

1.34

 

Normal Retirement Date

1-8

 

 

 

 

1.35

 

One Year Break-in-Service

1-8

 

 

 

 

1.36

 

Optional Benefit Form

1-8

 

 

 

 

1.37

 

Participant

1-8

 

 

 

 

1.38

 

Reserved

1-8

 

 

 

 

1.39

 

Participant Contributions

1-8

 

 

 

 

1.40

 

Plan, Plan and Trust, Trust

1-8

 

 

 

 

1.41

 

Plan Administrator

1-9

 

 

 

 

1.42

 

Plan Year

1-9

 

 

 

 

1.43

 

Reserved

1-9

 

 

 

 

1.44

 

Qualified Annuity Definitions

1-9

 

 

 

 

1.45

 

Required Beginning Date

1-12

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TABLE OF CONTENTS

 

 

 

 

 

ARTICLE 1 – DEFINITION (continued)

 

 

 

 

 

1.46

 

Section 401(a)(17) Limitation

1-12

 

 

 

 

1.47

 

Reserved

1-12

 

 

 

 

1.48

 

Surviving Spouse

1-12

 

 

 

 

1.49

 

Reserved

1-12

 

 

 

 

1.50

 

Reserved

1-12

 

 

 

 

1.51

 

Top-Heavy Definitions

1-13

 

 

 

 

1.52

 

Reserved

1-16

 

 

 

 

1.53

 

Trustee(s)

1-16

 

 

 

 

1.54

 

Vested Accrued Benefit

1-16

 

 

 

 

1.55

 

Vesting Schedule

1-16

 

 

 

 

1.56

 

Written Resolution

1-17

 

 

 

 

1.57

 

Years of Service

1-17

 

 

 

 

ARTICLE 2 - PARTICIPATION

 

 

 

 

 

2.01

 

Participation

2-1

 

 

 

 

2.02

 

Participation After Reemployment

2-1

 

 

 

 

2.03

 

Change in Employment Classification

2-2

 

 

 

 

2.04

 

Participation Waiver

2-2

 

 

 

 

2.05

 

Reserved

2-2

 

 

 

 

2.06

 

Reserved

2-2

 

 

 

 

2.07

 

Reserved

2-2

 

 

 

 

2.08

 

Reserved

2-2

 

 

 

 

ARTICLE 3 - RETIREMENT BENEFITS

 

 

 

 

 

3.01

 

Normal Retirement

3-1

 

 

 

 

3.02

 

Early Retirement

3-2

 

 

 

 

3.03

 

Late Retirement

3-2

 

 

 

 

3.04

 

Disability Retirement

3-3

 

 

 

 

3.05

 

Permitted Disparity Limits

3-4

 

 

 

 

3.06

 

Form of Benefit Payment

3-6

 

 

 

 

3.07

 

Optional Benefit Forms

3-6

 

 

 

 

3.08

 

Commencement of Benefit

3-7

 

 

 

 

3.09

 

Directed Transfer of Eligible Rollover Distributions

3-8

 

 

 

 

3.10

 

Suspension of Benefits after Commencement of Benefits

3-8

 

 

 

 

ARTICLE 4 – DEATH BENEFIT

 

 

 

 

 

4.01

 

Pre-Retirement Death Benefit

4-1

 

 

 

 

4.02

 

Post-Retirement Death Benefit

4-3

 

 

 

 

4.03

 

Effect of Death on Benefit Rights

4-3

 

 

 

 

4.04

 

Designation of Beneficiary

4-3

 

 

 

 

4.05

 

Reserved

4-3

 

 

 

 

4.06

 

Reserved

4-3

 

 

 

 

4.07

 

Reserved

4-3

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TABLE OF CONTENTS

 

 

 

 

 

ARTICLE 5 – TERMINATION OF EMPLOYMENT

 

 

 

 

 

5.01

 

Termination of Employment

5-1

 

 

 

 

5.02

 

Payment of Vested Accrued Benefit

5-1

 

 

 

 

5.03

 

Cash-Out Distribution

5-1

 

 

 

 

5.04

 

Forfeitures

5-1

 

 

 

 

5.05

 

Reemployment

5-2

 

 

 

 

5.06

 

Reserved

5-2

 

 

 

 

5.07

 

Reserved

5-2

 

 

 

 

5.08

 

Reserved

5-2

 

 

 

 

ARTICLE 6 - ACCRUED BENEFIT

 

 

 

 

 

6.01

 

Accrued Benefit

6-1

 

 

 

 

6.02

 

Minimum Benefit Requirement for Top-Heavy Plan

6-1

 

 

 

 

ARTICLE 7 - LIMITATION ON BENEFITS

 

 

 

 

 

7.01

 

Limitation on Benefits

7-1

 

 

 

 

7.02

 

Where Employer Maintains a Qualified Defined Contribution Plan

7-1

 

 

 

 

7.03

 

Definitions Applicable to Article 7

7-1

 

 

 

 

ARTICLE 8 - MISCELLANEOUS

 

 

 

 

 

8.01

 

Employment Rights of Parties Not Restricted

8-1

 

 

 

 

8.02

 

Alienation

8-1

 

 

 

 

8.03

 

Qualification of Plan

8-1

 

 

 

 

8.04

 

Construction

8-1

 

 

 

 

8.05

 

Named Fiduciaries

8-2

 

 

 

 

8.06

 

Status of Insurer

8-2

 

 

 

 

8.07

 

Adoption and Withdrawal by Other Organizations

8-2

 

 

 

 

8.08

 

Employer Contributions

8-3

 

 

 

 

8.09

 

Reserved

8-4

 

 

 

 

8.10

 

Reserved

8-4

 

 

 

 

8.11

 

Rollover Contributions

8-4

 

 

 

 

ARTICLE 9 – ADMINISTRATION

 

 

 

 

 

9.01

 

Plan Administrator

9-1

 

 

 

 

9.02

 

Powers and Duties of the Plan Administrator

9-1

 

 

 

 

9.03

 

Actions of the Plan Administrator

9-1

 

 

 

 

9.04

 

Reliance on Plan Administrator and Employer

9-1

 

 

 

 

9.05

 

Reports to Participants

9-2

 

 

 

 

9.06

 

Bond

9-2

 

 

 

 

9.07

 

Compensation of Plan Administrator

9-2

 

 

 

 

9.08

 

Claims Procedure

9-2

 

 

 

 

9.09

 

Liability of Fiduciaries

9-2

 

 

 

 

9.10

 

Expenses of Administration

9-3

 

 

 

 

9.11

 

Distribution Authority

9-3

 

 

 

 

9.12

 

Funding Policy

9-3

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TABLE OF CONTENTS

 

 

 

 

 

ARTICLE 10 - AMENDMENT OR TERMINATION OF PLAN

 

 

 

 

 

10.01

 

Right of Plan Sponsor to Amend or Terminate

10-1

 

 

 

 

10.02

 

Allocation of Assets Upon Termination of Plan

10-1

 

 

 

 

10.03

 

Exclusive Benefit

10-2

 

 

 

 

10.04

 

Failure to Qualify

10-2

 

 

 

 

10.05

 

Mergers, Consolidations or Transfers of Plan Assets

10-2

 

 

 

 

10.06

 

Effect of Plan Amendment on Vesting Schedule

10-3

 

 

 

 

10.07

 

Early Termination of Plan

10-3

 

 

 

 

10.08

 

Action by Employer

10-3

 

 

 

 

ARTICLE 11 – TRUSTEE AND TRUST FUND

 

 

 

 

 

11.01

 

Acceptance of Trust

11-1

 

 

 

 

11.02

 

Trust Fund

11-1

 

 

 

 

11.03

 

Receipt of Contributions

11-2

 

 

 

 

11.04

 

Powers of the Trustee

11-2

 

 

 

 

11.05

 

Investment in Common or Collective Trust Funds

11-3

 

 

 

 

11.06

 

Investment in Insurance Company Contracts

11-3

 

 

 

 

11.07

 

Fees and Expenses from Fund

11-4

 

 

 

 

11.08

 

Records and Accounting

11-4

 

 

 

 

11.09

 

Distribution Directions

11-4

 

 

 

 

11.10

 

Third Party

11-4

 

 

 

 

11.11

 

Professional Agents

11-4

 

 

 

 

11.12

 

Valuation of Trust

11-4

 

 

 

 

11.13

 

Liability of Trustee

11-4

 

 

 

 

11.14

 

Removal or Resignation and Successor Trustee

11-5

 

 

 

 

11.15

 

Appointment of Investment Manager

11-5

 

 

 

 

APPENDICIES

 

 

 

 

 

A

 

Actuarial Equivalent

 

 

 

 

 

B

 

Former Schenectady Federal Savings Bank Retirement Plan Participants

 

 

 

 

 

C

 

Former Schenectady Federal Savings Bank Retirement Plan Actuarial Adjustment
Factors

 

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ARTICLE 1

DEFINITIONS

As used in this document, unless otherwise defined or required by the context,
the following terms have the meanings set forth in this Article 1. Some of the
terms used in this document are not defined in Article 1, but for convenience
are defined as they are introduced in the text.

1.01

Accrued Benefit

(a)

In General

Subject to the provisions of Article 6, the Accrued Benefit for each Participant
is determined using the same formula, which is used to compute the Participant’s
Normal Retirement Benefit in Section 3.01.

(b)

Section 401(a)(17) Employee

A Section 401(a)(17) Employee means an Employee whose current Accrued Benefit as
of a date on or after the first day of the first plan year beginning on or after
October 1, 1994, is based on Compensation for a year beginning prior to the
first day of the first plan year beginning on or after October 1, 1994, that
exceeded $150,000.

(c)

Fresh Start with Extended Wear-Away

Unless otherwise provided under the Plan, effective for the first plan year
beginning on or after October 1, 1994, each Section 401(a)(17) Employee’s
Accrued Benefit under this Plan will be the greater of the Accrued Benefit
determined for the Employee under (1) or (2) below:

(1)

The Employee’s Accrued Benefit determined with respect to the current formula,
as applied to the Employee’s total years of service taken into account under the
Plan for purposes of benefit accruals, or

(2)

The sum of:

(A)

A Participant’s frozen Accrued Benefit is the amount of the Participant’s
Accrued Benefit as of the latest fresh start date which is the last day of the
Plan Year beginning before October 1, 1994, determined as if the Participant
terminated employment with the Employer as of the latest fresh-start date, (or
the date the Participant actually terminated employment with the Employer, if
earlier), without regard to any amendment made to the Plan after that date other
than amendments recognized as effective as of or before the date under section
401(b) of the Internal Revenue Code or section 1.401(a)(4)-11(g) of the
regulations, and

(B)

The Employee’s Accrued Benefit determined under the current formula, as applied
to the Employee’s years of service credited to the Employee for plan years
beginning on or after October 1, 1994 for purposes of benefit accruals.

1.02

Reserved

1.03

Actuarial Equivalent

Actuarial Equivalent shall mean a form of benefit differing in time, period
and/or manner of payment from another form of benefit but having the same value
when computed based upon the tables set forth in Appendix A.

However, in the case of any former Schenectady Federal Savings Bank Retirement
Plan Participant, “Actuarial Equivalent” shall be determined in accordance with
the factors set forth in Appendix C for that portion of their benefit accrued as
of September 3, 1999 under the former Schenectady Federal Savings Bank
Retirement Plan.

1-1

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1.04

Affiliated Employer

An Affiliated Employer or Related Employer means any corporation, association,
trade, company or business on or after the Effective Date which is, along with
the Employer, a member of the same Controlled Group of corporations (as defined
in section 414(b) of the Code), an affiliated service group (as defined in
section 414(m) of the Code), or any organization or arrangement required to be
aggregated with the Employer by Treasury Regulations issued under section 414(o)
of the Code, but who has not adopted the Plan.

1.05

Average Annual Compensation

A Participant’s Average Annual Compensation shall mean the Participant’s average
annual Compensation during the thirty-six (36) consecutive calendar months
within the final one hundred-twenty (120) consecutive calendar months of the
Participant’s Years of Benefit Service affording the highest such average.

If a Participant has less than thirty-six (36) consecutive months of Years of
Benefit Service, his total Years of Benefit Service and Compensation shall be
used to compute such average.

In determining Average Annual Compensation, Years of Benefit Service before and
after a One Year period of Severance, Military Leave, or other leave of absence
for which no Compensation is received by the Participant shall be deemed to be
consecutive.

1.06

Beneficiary

Beneficiary means the person, persons, Trust, Estate or any other entity
designated in accordance with the terms of the Plan to receive any amount
payable upon the death of a Participant.

1.07

Reserved

1.08

Code and ERISA

Code means the Internal Revenue Code of 1986, as it may be amended from time to
time, and all regulations issued thereunder. Reference to a section of the Code
includes that section and any comparable section or sections of any future
legislation that amends, supplements or supersedes such section and any
regulations issued thereunder.

ERISA means Public Law No. 93-406, the Employee Retirement Income Security Act
of 1974, as may be amended from time to time, and all regulations issued
thereunder. Reference to a section of ERISA includes that section and any
comparable section or sections of any future legislation that amends,
supplements or supersedes such section and any regulations issued thereunder.

1.09

Compensation

Except where otherwise specifically provided in this Plan, Compensation shall
mean Aggregate Compensation as defined in section 7.03(a).

Compensation also includes any amounts contributed by the Employer or any
Related Employer on behalf of any Employee pursuant to a salary reduction
agreement and which is not includible in the gross income of the Employee under
sections 125, 402(e)(3) (referring to salary deferral contributions under a Code
section 401(k) plan), 402(h), 403(b) or 457(b) of the Code.

Compensation shall exclude overtime payments, bonuses or other special payments.

If a Participant was employed by the Former Schenectady Federal Savings Bank on
September 2, 1999 and became employed by the Employer on September 3, 1999, his
compensation with the Former Schenectady Federal Savings Bank shall be deemed to
be compensation with the Employer and, with respect to the portion of such
Participant’s benefit accrued as of September 3, 1999 under the Former
Schenectady Federal Savings Bank Retirement Plan, Compensation shall be as set
forth in Section B.1 of Appendix B.

1-2

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

Notwithstanding the foregoing, for all purposes under this Plan, other than
Article 7, Compensation in excess of $150,000 (as adjusted by the Secretary of
the Treasury under Section 401(a)(17)(B) of the Code) will be disregarded.

Compensation Period shall mean a consecutive twelve (12) month period commencing
with the date an Employee completes an Hour of Service and any subsequent
anniversary date thereof. For any Employee who was an employee of the Former
Schenectady Federal Savings Bank on September 2, 1999, and became employed by
the Employer on September 3, 1999, employment with the Former Schenectady
Federal Savings Bank shall be deemed employment with the Employer for purposes
of determining such Employee’s Computation Period.

1.10

Controlled Group

An Employer and such corporations and business organizations (whether or not
incorporated), if any, as together with such Employer, are members of a
controlled or affiliated service group, as such terms are defined in section
414(b), (c), (m), and (o) of the Code provided, however, that for purposes of
applying the provisions of the Plan with respect to limitations on contributions
and benefits, section 415(h) of the Code shall apply. All employees of the
Controlled Group shall be treated as employed by a single employer.

1.11

Reserved

1.12

Reserved

1.13

Defined Benefit Plan

A plan which is established and qualified under section 401 or 403 of the Code,
except to the extent it is treated as a Defined Contribution Plan.

1.14

Defined Contribution Plan

A plan which is established and qualified under section 401 or 403 of the Code,
which provides for an individual account plan for each Participant therein and
for benefits based solely on the amount contributed to each Participant’s
account and any income and expenses or gains or losses (both realized and
unrealized) which may be allocated to such accounts.

1.15

Effective Date

The Effective Date of the Plan is May 1, 1941. Except as specified elsewhere in
this document, the effective date of this restatement of the Plan is October 1,
1997.

1.16

Eligible Employee Classification

An Eligible Employee Classification is a classification of Employees, the
members of which are eligible to participate in the Plan. The Plan covers all
employee classifications except:

(a)

Employees compensated by the Employer on an “hourly rate” or “contract” basis.

(b)

Employees regularly employed outside the Employer’s own offices in connection
with the operation and maintenance of buildings or other properties acquired
through foreclosure or deed.

(c)

All Leased Employees.

(d)

Prior to October 1, 1988, Employees who at the time of their employment by the
Employer have attained age sixty (60).

1.17

Employee

(a)

In General

An Employee is any person who is employed by the Employer or a Participating
Employer.

1-3

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

(b)

Leased Employee

A Leased Employee means any person who, pursuant to an agreement between the
Employer or any Related Employer (“Recipient Employer”) and any other person
(“leasing organization”), has performed services for the Recipient Employer or
for the Recipient Employer and related persons determined in accordance with
section 414(n)(6) on a substantially full-time basis for a period of at least
one year and such services are preformed under the primary direction or control
of the Recipient Employer.

Any Leased Employee will be treated as an Employee of the Recipient Employer;
however, contributions or benefits provided by the leasing organization which
are attributable to the services performed for the Recipient Employer will be
treated as provided by the Recipient Employer. If all Leased Employees
constitute less than 20% of the Employer’s non-highly-compensated work force
within the meaning of section 414(n)(1)(C)(ii) of the Code, then the preceding
sentence will not apply to any Leased Employee provided such Employee is covered
by a money purchase pension plan (“Safe Harbor Plan”) which provides: (1) a
nonintegrated employer contribution rate of at least 10% of compensation as
defined under section 415(c)(3) of the Code, (2) immediate participation, and
(3) full and immediate vesting.

Years of Eligibility Service for purposes of eligibility to participate in the
Plan and Years of Vesting Service for purposes of determining a Participant’s
Vested Percentage include service by an Employee as a Leased Employee.

1.18

Employer, Plan Sponsor, and Participating Employer

The Employer and Plan Sponsor is The Hudson River Bank & Trust Company. A
Participating Employer is any organization which has adopted this Plan and Trust
in accordance with section 8.07.

The term Predecessor Employer means any prior employer to which the Employer is
the successor, including any Predecessor Employer for which the Employer
maintains the obligations of a Predecessor Plan established by such Predecessor
Employer. Service with a Predecessor Employer will be included as Service with
the Employer for all purposes under this Plan.

“Former Schenectady Federal Savings Bank” means Schenectady Federal Savings
Bank, which was merged with and into the Hudson River Bank & Trust Company on
September 3, 1999.

1.19

Employment Commencement Date

The date an Employee first completes an Hour of Service for the Employer.

1.20

Entry Date

Entry Date means the first of the calendar month which coincides with or next
follows the date upon which the eligibility requirements are met

1.21

Reserved

1.22

Expected Retirement Benefit

For purposes of this section, a participant’s Expected Retirement Benefit is
equal to the annual benefit to which a participant in a defined benefit plan
would be entitled under the terms of the plan based on the following
assumptions:

(a)

The participant will continue employment until reaching normal retirement age as
determined under the terms of the plan (or current age, if that is later);

(b)

The participant’s compensation for the Limitation Year under consideration will
remain the same for all future years; and

(c)

All other relevant factors used to determine benefits under the plan for the
Limitation Year under consideration will remain constant for all future
Limitation Years.

1-4

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

1.23

Fiscal Year

Fiscal Year means the taxable year of the Plan Sponsor. The Fiscal Year of the
Plan Sponsor is the 12-month period beginning October 1 and ending September 30.

1.24

Reserved

1.25

Highly Compensated Definitions

(a)

Compensation

For purposes of this section, Compensation means Aggregate Compensation as
defined in Section 7.03(a) plus, for Plan Years beginning after December 31,
1997, amounts contributed by the Employer pursuant to a salary reduction
agreement which are excludable from the gross income of the Employee under
section 125, 402(e)(3), 402(h)(1)(B), 403(b) or 457(b) of the Code.

(b)

Determination Year

Determination Year means the Plan Year for which the determination of who is
Highly Compensated is being made.

(c)

Highly Compensated Employee

Highly Compensated Employee means any individual who is a Highly Compensated
Active Employee or a Highly Compensated Former Employee as defined below.

(d)

Highly Compensated Active Employee

Highly Compensated Active Employee means any individual who is a member of
category (1) or (2) below:

(1)

Was at any time during the current or prior Plan Year, a 5-percent Owner (within
the meaning of section 416(i) of the Code) of the Employer or any Related
Employer.

(2)

Received Compensation from the Employer and all Related Employers in excess of
$80,000 in the immediate prior plan year (or any greater amount determined by
regulations issued by the Secretary of the Treasury under section 415(d) of the
Code) and is a member of the Top-Paid Group;

(e)

Highly Compensated Former Employee

Highly Compensated Former Employee means any Former Employee who had a
Separation Year (within the meaning of Treasury Regulation section 1.414(q)-1T
Q&A-5) and was a Highly Compensated Active Employee for either the Separation
Year or any Determination Year ending on or after the Employee’s 55th birthday.

(f)

Highly Compensated Group

Highly Compensated Group means all Highly Compensated Employees.

(g)

Non-Highly Compensated Employee

Non-Highly Compensated Employee means an Employee who is not a Highly
Compensated Employee.

(h)

Non-Highly Compensated Group

Non-Highly Compensated Group means all Non-Highly Compensated Employees.

(i)

Top-Paid Group

Top-Paid Group means those individuals who are among the top 20 percent of
Employees of the Employer and all Related Employers when ranked on the basis of
Compensation received during the year. In determining the number of individuals
in the Top-Paid Group (but not the identity of those individuals), the following
individuals will be excluded:

1-5

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(1)

Employees who have not completed 6 months of Service by the end of the year. For
this purpose, an Employee who has completed One Hour of Service in any calendar
month will be credited with one month of Service;

(2)

Employees who normally work fewer than 17½ hours per week;

(3)

Employees who normally work fewer than 6 months during any year. For this
purpose, an Employee who has worked on one day of a month is treated as having
worked for the whole month;

(4)

Employees who have not reached age 21 by the end of the year;

(5)

Nonresident aliens who received no earned income (which constitutes income from
sources within the United States) within the year from the Employer or any
Related Employer; and

(6)

Employees covered by a collective bargaining agreement negotiated in good faith
between the employee representatives and the Employer or a group of employers of
which the Employer is a member if (i) 90% or more of all employees of the
Employer and all Related Employers are covered by collective bargaining
agreements, and (ii) this Plan covers only Employees who are not covered under a
collective bargaining agreement.

1.26

Reserved

1.27

Hour of Service

An Hour of Service means:

(a)

Each hour for which an Employee is paid, or entitled to payment, for the
performance of duties for the Employer. These hours will be credited to the
Employee for the Computation Period in which the duties are performed; and

(b)

Each hour for which an Employee is paid, or entitled to payment, by the Employer
on account of a period of time during which no duties are performed
(irrespective of whether the employment relationship has terminated) due to
vacation, holiday, illness, incapacity (including disability), layoff, jury
duty, military duty or leave of absence. No more than 501 Hours of Service will
be credited under this paragraph for any 12-month period. Hours under this
paragraph will be calculated and credited pursuant to section 2530.200b-2 of the
Department of Labor Regulations which are incorporated herein by this reference;
and

(c)

Each hour for which back pay, irrespective of mitigation of damages, is either
awarded or agreed to by the Employer. The same Hours of Service will not be
credited both under paragraphs (a) or (b), as the case may be, and under this
paragraph (c). These hours will be credited to the Employee for the computation
period or periods to which the award or agreement pertains rather than the
computation period in which the award, agreement or payment is made.

(d)

Commencing November 13, 1989, Hours of Service shall include service with the
Dime Savings Bank of New York which immediately precedes the Employee’s
employment with the Employer.

(e)

Commencing August 22, 1994, Hours of Service shall include service with the
branch of Rhinebeck Savings Bank that was purchased by the Employer on August
22, 1994, and which immediately preceded the Employee’s employment with the
Employer.

Hours of Service for Employees for whom records of hours are not maintained
shall be determined on the assumption that each such Employee has completed
forty-five (45) Hours of Service during each week for which he would be required
to be credited with at least one (1) Hour of Service.

1-6

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Hours of Service will be credited for employment with other members of an
affiliated service group (under section 414(m) of the Code), a controlled group
of corporations (under section 414(b) of the Code), or a group of trades or
businesses under common control (under section 414(c) of the Code), of which the
adopting Employer is a member, and any other entity required to be aggregated
with the Employer pursuant to section 414(o) of the Code. Hours of Service will
also be credited for any individual considered to be a Leased Employee under
section 414(n) of the Code.

Solely for purposes of determining whether a One Year Break-in-Service for
participation and vesting purposes has occurred in a computation period, an
individual who is absent from work for maternity or paternity reasons shall
receive credit for the Hours of Service which would otherwise have been credited
to such individual but for such absence, or in any case in which such hours
cannot be determined, 8 Hours of Service per day of such absence. For purposes
of this paragraph, an absence from work for maternity or paternity reasons means
an absence (1) by reason of the pregnancy of the individual, (2) by reason of a
birth of a child of the individual, (3) by reason of the placement of a child
with the individual in connection with the adoption of such child by such
individual, or (4) for purposes of caring for such child for a period beginning
immediately following such birth or placement. The Hours of Service credited
under this paragraph shall be credited (1) in the computation period in which
the absence begins if the crediting is necessary to prevent a Break-in-Service
in that period, or (2) in all other cases, in the following computation period.
The affected Employee is required to furnish such timely information as the Plan
Administrator may require to establish that absence is for the reason described
herein and to establish the period of such absence.

Hours of Service shall be determined on the basis of actual hours for which an
Employee is paid or entitled to payment.

1.28

Reserved

1.29

Reserved

1.30

Leave of Absence

An authorized Leave of Absence means a period of time of one year or less
granted to an Employee by the Employer due to illness, injury, temporary
reduction in work force, or other appropriate cause or due to military service
during which the Employee’s reemployment rights are protected by law, provided
the Employee returns to the service of the Employer on or before the expiration
of such leave, or in the case of military service, within the time his
reemployment rights are so protected or within 60 days of his discharge from
military service if no federal law is applicable. All authorized Leaves of
Absence are granted or denied by the Employer in a uniform and nondiscriminatory
manner, treating Employees in similar circumstances in a like manner.

If the Participant does not return to active service on or prior to the
expiration of his authorized Leave of Absence he will be considered to have had
a Date of Severance as of the earlier of the date on which his authorized Leave
of Absence expired, the first anniversary of the last date he worked at least
one hour as an Active Participant, or the date on which he resigned or was
discharged.

1.31

Limitation Year

The Limitation Year is the 12-month period beginning October 1 and ending
September 30. The Limitation Year coincides with the Plan Year.

1.32

Reserved

1.33

Normal Retirement Age

A Participant’s Normal Retirement Age is his attained age on the date which he
satisfies the following requirements, except as otherwise described in Section
B.3 of Appendix B:

The later of:

(a)

if the Employee became a Participant prior to October 1, 1988, age sixty-five
(65), or

1-7

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(b)

if the Employee became a Participant on or after October 1, 1988, the later of
(i) the time a Participant attains age 65, or (ii) the fifth (5th) anniversary
of the time an active Participant commenced participation in the Plan.

1.34

Normal Retirement Date

A Participant’s Normal Retirement Date is the first day of the month which
coincides with or next follows the date on which the Participant attains Normal
Retirement Age.

1.35

One Year Break-in-Service

One Year Break-in-Service means any Plan Year during which the Employee
completes 500 or fewer Hours of Service.

1.36

Optional Benefit Form

Any Optional Benefit Form which is provided under the Plan is described in
section 3.07.

1.37

Participant

An Employee or former Employee who is eligible to participate in this Plan and
who is or who may become eligible to receive a benefit of any type from this
Plan or whose Beneficiary may be eligible to receive any such benefit.

(a)

Active Participant means a Participant who is currently an Employee.

(b)

Vested Participant means a Participant who is currently an Employee who has a
nonforfeitable right to all or a portion of his or her Accrued Benefit.

(c)

Disabled Participant means a Participant who has terminated his employment with
the Employer and who is entitled to a Disability Retirement Benefit under the
Plan.

(d)

Retired Participant means a Participant who has terminated his employment with
the Employer after meeting the requirements for a Normal, Early or Late
Retirement Benefit and who is receiving such benefits.

(e)

Vested Terminated Participant means a Participant who has terminated his
employment with the Employer and who has a nonforfeitable right to all or a
portion of his or her Accrued Benefit and who has not received a distribution of
the value of his or her Vested Accrued Benefit.

(f)

Former Participant means a Participant who has terminated his employment with
the Employer and who currently has no vested right to any portion of his or her
Accrued Benefit.

(g)

Former Schenectady Federal Savings Bank Retirement Plan Participant means any
individual who was a participant in the Former Schenectady Federal Savings Bank
Retirement Plan on September 2, 1999 and who became a Participant in the Plan on
September 3, 1999 in connection with the merger of the Former Schenectady
Federal Savings Bank with and into the Employer.

1.38

Reserved

1.39

Participant Contributions

No Participant Contributions are required or permitted under this Plan.

1.40

Plan, Plan and Trust, Trust

The terms Plan, Plan and Trust, and Trust mean the Retirement Plan of The Hudson
River Bank & Trust Company. The Plan Identification Number is 001. The term
Predecessor Plan means any qualified plan previously established and maintained
by the Employer and to which this Plan is the successor.

“Former Schenectady Federal Savings Bank Retirement Plan” means the Schenectady
Federal Savings Bank Retirement Income Plan maintained by the Former Schenectady
Federal Savings Bank prior to September 3, 1999 and thereafter maintained by the
Employer, which Plan was merged with and into the Plan, effective October 1,
1999.

1-8

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

1.41

Plan Administrator

The Plan Administrator is the Hudson River Bank & Trust Company.

1.42

Plan Year

The Plan Year is the 12-month period beginning October 1 and ending September
30.

1.43

Reserved

1.44

Qualified Annuity Definitions

(a)

Annuity Starting Date

Annuity Starting Date means (i) the first day of the first period for which an
amount is payable as an annuity, or (ii) in the case of a benefit not payable in
the form of an annuity, the first day on which all events have occurred which
entitled the Participant to the benefit.

(b)

Earliest Retirement Age

The Earliest Retirement Age under this Plan is the earliest age at which a
Participant could terminate his employment and receive a distribution. Death and
retirement of a Participant are both treated as a termination of employment. If
a Participant terminates his employment before the Earliest Retirement Age, only
his actual years of service at the time of his termination of employment are
taken into account.

(c)

Qualified Election

(1)

In General

A Participant:

(A)

May elect at any time during the applicable election period to waive the
Qualified Joint & Survivor Annuity form of benefit or the Qualified
Preretirement Survivor Annuity form of benefit (or both), and

(B)

May revoke any such election at any time during the applicable election period.

For purposes of this subsection, the term “Applicable Election Period” means:

(C)

In the case of an election to waive the Qualified Joint and Survivor Annuity
form of benefit, the 90-day period ending on the annuity starting date, or

(D)

In the case of an election to waive the Qualified Preretirement Survivor
Annuity, the period which begins on the first day of the Plan Year in which the
Participant attains age 35 and ends on the date of the Participant’s death.

In the case of a Participant who is separated from service, the applicable
election period under subparagraph (D) with respect to benefits accrued before
the date of such separation from service shall not begin later than such date.

Qualified Election means a written waiver of a Qualified Joint and Survivor
Annuity or a Qualified Pre-retirement Survivor Annuity. The waiver must be
consented to by the Participant’s spouse with such consent witnessed by a
representative of the Plan Administrator or a notary public. The spouse’s
consent must include the designation of a specific Beneficiary and the form of
payment which cannot be changed without the consent of the spouse. Such consent
will not be required if the Participant establishes to the satisfaction of the
Plan Administrator that such written consent may not be obtained because there
is no spouse, the spouse cannot be located or other circumstances that may be
prescribed by Treasury Regulations. Any consent which is required under this
section will be valid only with respect to the spouse who signs the consent (or
in the event of a deemed Qualified Election, the designated

1-9

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

spouse). Additionally, a revocation of a prior waiver may be made by a
Participant without the consent of the spouse at any time before the
commencement of benefits; however, any waiver of a Qualified Joint and Survivor
Annuity or a Qualified Pre-retirement Survivor Annuity which follows such
revocation must be in writing and must be consented to by the Participant’s
spouse in the manner described above. The number of waivers or revocations of
such waivers will not be limited.

Wherever the consent of the Participant’s spouse is required, it will be valid
only if it is in writing, acknowledges the effect of the consent, and is
witnessed by a notary public, the Plan Administrator or the duly appointed
representative of the Plan Administrator. The consent will not be required if
the participant establishes to the satisfaction of the Plan Administrator that
written consent cannot be obtained because there is no spouse, the spouse cannot
be located, or other circumstances prescribed by Treasury Regulation section
1.401(a)-20 Q&A 27. Any consent necessary under this provision will be valid
only with respect to the spouse who signs the consent.

(2)

Qualified Joint and Survivor Annuity Notices

With respect to any married Participant who does not die before his Annuity
Starting Date, within the 30 to 90-day period which ends on a married
Participant’s Annuity Starting Date, the Plan Administrator will provide the
Participant with a written explanation of:

(A)

The terms and conditions of a Qualified Joint and Survivor Annuity;

(B)

The Participant’s right to make and the effect of a Qualified Election to waive
the Qualified Joint and Survivor Annuity form of benefit;

(C)

A general description of the eligibility conditions and other material features
of the optional forms of benefit and sufficient additional information to
explain the relative values of the optional forms of benefit available;

(D)

The rights of the Participant’s spouse; and

(E)

The right to make, and the effect of, a revocation of a previous Qualified
Election to waive the Qualified Joint and Survivor Annuity.

The Participant (subject to spousal consent) may waive any requirement that the
description be provided at least 30-days prior to the annuity starting date
provided that the distribution does not commence until at least 7 days after the
description is provided.

(3)

Qualified Pre-retirement Survivor Annuity Notices

The election period to waive the Qualified Survivor Pre-retirement Annuity will
begin on the first day of the Plan Year in which the Participant attains age 35
and end on the date of the Participant’s death. If a Vested Terminated
Participant separates from service before the beginning of the election period,
the election period will begin on the date of separation from service. The Plan
Administrator will, within the applicable notice period, provide each
Participant a written explanation of the Qualified Pre-retirement Survivor
Annuity containing comparable information to that required under the provisions
of section 1.44(c)(2). For purposes of this paragraph, the term “applicable
notice period” means whichever of the following periods ends last:

(A)

The period beginning with the first day of the Plan Year in which the
Participant attains age 32 and ending with the close of the Plan Year preceding
the Plan Year in which the Participant attains age 35;

(B)

12 months after the individual becomes a Participant;

1-10

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

(C)

12 months after the Qualified Pre-retirement Survivor Annuity ceases to be a
fully subsidized benefit;

(D)

12 months after the joint and survivor rules become effective for the
Participant; or

(E)

12 months after the Participant separates from service before attaining age 35.

(d)

Qualified Joint and Survivor Annuity

A Qualified Joint and Survivor Annuity means an immediate annuity which is
payable for the life of the Participant with a survivor annuity for the life of
his Surviving Spouse in an amount which is 50% of the amount payable during the
joint lives of the Participant and his spouse. The amount of the Qualified Joint
and Survivor Annuity will be the actuarial equivalent of the Normal Benefit
Form. A Participant may elect, without the consent of his Spouse, to receive any
other actuarially equivalent annuity which is payable for the life of the
Participant with a survivor annuity for the life of his Surviving Spouse in an
amount which is not less than 50% nor more than 100% of the amount payable
during the joint lives of the Participant and his spouse, but only if such
benefit is an Optional Form of Benefit provided in section 3.07.

(e)

Qualified Life Annuity

A Qualified Life Annuity means an immediate annuity which is payable for the
lifetime of the Participant with payments terminating on the death of the
Participant.

(f)

Qualified Preretirement Survivor Annuity

Qualified Preretirement Survivor Annuity means the monthly benefit payable for
the remaining lifetime of a Surviving Spouse to which the Surviving Spouse is
entitled under section 4.01.

If a Participant dies on or after his Earliest Retirement Age, the monthly
Qualified Preretirement Survivor Annuity benefit will be equal to 50% of the
monthly benefit which would have been paid to the Participant and his Surviving
Spouse if he had elected to retire on the day preceding his date of death and to
receive his retirement benefit as a Qualified Joint and Survivor Annuity with
50% payable to the Surviving Spouse.

If a Participant dies before his Earliest Retirement Age, the monthly Qualified
Preretirement Survivor Annuity benefit will be deferred until his Earliest
Retirement Age unless the Surviving Spouse elects to have payment of the
Qualified Preretirement Survivor Annuity begin at a later date. If the Surviving
Spouse does not survive until the Participant’s Earliest Retirement Age (or the
deferred date for beginning payments if elected), the Qualified Preretirement
Survivor Annuity will be forfeited. The monthly Qualified Preretirement Survivor
Annuity benefit will be computed as if the Participant had:

(1)

Separated from service on the earlier of date of death or the actual date of
separation from service;

(2)

Survived to his Earliest Retirement Age;

(3)

Elected to retire on his Earliest Retirement Age and to receive his retirement
benefit as a Qualified Joint and Survivor Annuity with 50% payable to the
Surviving Spouse; and

(4)

Died on the date after his Earliest Retirement Age.

The Surviving Spouse may elect to receive the Actuarial Equivalent of the
Qualified Preretirement Survivor Annuity in any Optional Benefit Form which is
available under section 3.07. However, notwithstanding anything to the contrary,
if the lump sum value of a Surviving Spouse’s Qualified Preretirement Survivor
Annuity is $5,000 or less, the Plan Administrator will direct the immediate
distribution of the value of the Qualified Preretirement Survivor Annuity to the
Surviving Spouse. For distributions prior to March 22, 1999, if the lump sum
value of a Surviving Spouse’s Qualified Preretirement Survivor Annuity has ever
exceeded $5,000, the lump sum value will be deemed to exceed $5,000. For Plan
Years beginning prior to August 5, 1997, the $5,000 dollar limit will read
$3,500 wherever it appears in this Section.

1-11

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

1.45

Required Beginning Date

A Participant’s Required Beginning Date for the commencement of benefit payments
from the Plan for Plan years beginning after October 1, 1998 is:

(a)

The April 1 immediately following the calendar year in which he attains age
70-1/2, if he is or was a Five Percent Owner at any time during the Plan Year
ending with or within the calendar year in which he attains age 70-1/2; or

(b)

The later of the April 1 of the calendar year in which the participant attains
age 70½ or retires for any other Participant who is not a five percent owner.

For Plan Years beginning before October 1, 1998, a Participant shall have the
option to elect to commence distribution of his entire interest in this Plan in
accordance with the rules of IRC 401(a)(9) and related regulations as in effect
immediately prior to its amendment to conform with the Small Business and Job
Protection Act of 1996.

1.46

Section 401(a)(17) Limitation

In addition to other applicable limitations set forth in the plan, with the
exception of the Fresh Start Rules applicable to Plan Years beginning before
October 1, 1994 and Article 7, for plan years beginning on or after October 1,
1994, the annual compensation of each employee taken into account under the plan
shall not exceed the OBRA ‘93 annual compensation limit. The OBRA ‘93 annual
compensation limit is $150,000, as adjusted by the Commissioner for increases in
the cost of living in accordance with section 401(a)(17)(B) of the Code. The
cost-of-living adjustment in effect for a calendar year applies to any period,
not exceeding 12 months, over which compensation is determined (determination
period) beginning in such calendar year. If a determination period consists of
fewer than 12 months, the OBRA ‘93 annual compensation limit will be multiplied
by a fraction, the numerator of which is the number of months in the
determination period, and the denominator of which is 12.

For plan years beginning on or after October 1, 1994, any reference in the plan
to the limitation under section 401(a)(17) of the Code shall mean the OBRA ‘93
annual compensation limit set forth in this provision.

Except as specified in the application of the Fresh Start Rules, if compensation
for any prior determination period is taken into account in determining an
employee’s benefits accruing in the current plan year, the compensation for that
prior determination period is subject to the OBRA ‘93 annual compensation limit
in effect for that prior determination period. For this purpose, for
determination periods beginning before the first day of the first plan year
beginning on or after October 1, 1994, the OBRA ‘93 annual compensation limit is
$150,000.

1.47

Reserved

1.48

Surviving Spouse

The terms Surviving Spouse and Spouse mean a deceased Participant’s spouse who
was married to the Participant throughout the one (1) year period ending on the
earlier of the Annuity Starting Date or the date of the Participant’s death. The
Plan Administrator and the Trustee may rely conclusively on a Participant’s
written statement of his marital status. Neither the Plan Administrator nor the
Trustee is required at any time to inquire into the validity of any marriage,
the effectiveness of a common-law relationship or the claim of any alleged
spouse which is inconsistent with the Participant’s report of his marital status
and the identity of his spouse.

1.49

Reserved

1.50

Reserved

1-12

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

1.51

Top-Heavy Definitions

(a)

Aggregate Account

Aggregate Account means, with respect to each Participant, the value of all
accounts maintained on behalf of the Participant, whether attributable to
Employer or Employee contributions, used to determine Top-Heavy Plan status
under the provisions of a Defined Contribution Plan. A Participant’s Aggregate
Account as of the Determination Date will be the sum of:

(1)

The balance of his Account(s) as of the most recent valuation date occurring
within a 12-month period ending on the Determination Date (excluding any amounts
attributable to deductible voluntary employee contributions); plus

(2)

Contributions that would be allocated as of a date not later than the
Determination Date, even though those amounts are not yet made or required to be
made; plus

(3)

Any Plan Distributions made within the Plan Year that includes the Determination
Date or within the four preceding Plan Years.

(b)

Aggregation Group

Aggregation Group means either a Required Aggregation Group or a Permissive
Aggregation Group as hereinafter determined.

(1)

Required Aggregation Group

Each plan of the Employer in which a Key Employee is a Participant, and each
other plan of the Employer which enables any plan in which a Key Employee
participates to meet the requirements of section 401(a)(4) or 410 of the Code,
will be aggregated and the resulting group will be known as a Required
Aggregation Group.

Each plan in the Required Aggregation Group will be considered a Top-Heavy Plan
if the Required Aggregation Group is a Top-Heavy Group. No plan in the Required
Aggregation Group will be considered a Top-Heavy Plan if the Required
Aggregation Group is not a Top-Heavy Group.

(2)

Permissive Aggregation Group

The Employer may also include any other plan not required to be included in the
Required Aggregation Group, provided the resulting group (to be known as a
Permissive Aggregation Group), taken as a whole, would continue to satisfy the
provisions of sections 401(a)(4) and 410 of the Code.

Only a plan that is part of the Required Aggregation Group will be considered a
Top-Heavy Plan if the Permissive Aggregation Group is a Top-Heavy Group. No plan
in the Permissive Aggregation Group will be considered a Top-Heavy Plan if the
Permissive Aggregation Group is not a Top-Heavy Group.

Only those plans of the Employer in which the Determination Dates fall within
the same calendar year will be aggregated in order to determine whether the
plans are Top-Heavy Plans.

(c)

Determination Date

Determination Date means the last day of the preceding Plan Year, or, in the
case of the first Plan Year, the last day of the first Plan Year.

(d)

Key Employee

Key Employee means any Employee or former Employee (and his Beneficiary) who, at
any time during the Plan Year or any of the preceding four Plan Years, was:

1-13

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(1)

A “Five Percent Owner” of the Employer. “Five Percent Owner” means any person
who owns (or is considered as owning within the meaning of section 318 of the
Code) more than 5% of the value of the outstanding stock of the Employer or
stock possessing more than 5% of the total combined voting power of all stock of
the Employer. If the Employer is not a corporation, Five Percent Owner means any
person who owns more than 5% of the capital or profits interest in the Employer.
In determining percentage ownership hereunder, Related Employers will be treated
as separate Employers; or

(2)

A “One Percent Owner” of the Employer having Compensation from the Employer of
more than $150,000. “One Percent Owner” means any person who owns (or is
considered as owning within the meaning of section 318 of the Code) more than 1%
of the value of the outstanding stock of the Employer or stock possessing more
than 1% of the total combined voting power of all stock of the Employer. If the
Employer is not a corporation, One Percent Owner means any person who owns more
than 1% of the capital or profits interest in the Employer. In determining
percentage ownership hereunder, Related Employers will be treated as separate
Employers. However, in determining whether an individual has Compensation of
more than $150,000, Compensation from each Related Employer will be taken into
account; or

(3)

One of the 10 Employees having Compensation not less than dollar limit under
Section 415(c)(1)(A) (relating to defined contribution plans) who owns (or is
considered as owning within the meaning of section 318 of the Code) the largest
interests in all Employers required to be aggregated under sections 414(b), (c),
(m) and (o) of the Code; or

(4)

An officer (within the meaning of the regulations under section 416 of the Code)
of the Employer having Compensation greater than 50% of the Defined Benefit
Dollar Limit as defined in section 7.03(f) for the Plan Year.

For purposes of this Section, Compensation means Aggregate Compensation as
defined in Section 7.03(a) plus any amounts contributed by the Employer pursuant
to a salary reduction agreement which are excludable from the gross income of
the Employee under sections 125, 402(e)(3), 402(h)(1)(B), 403(b), or 457(b) of
the Code.

Compensation in excess of the Section 401(a)(17) Limitation (as adjusted by the
Secretary of the Treasury under section 401(a)(17)(B) of the Code) will be
disregarded.

(e)

Non-Key Employee

Non-Key Employee means any Employee (and his Beneficiaries) who is not a Key
Employee.

(f)

Plan Distributions

Plan distributions include distributions made before October 1, 1984, and
distributions under a terminated plan which, if it had not been terminated,
would have been required to be included in an aggregation group. However,
distributions made after the Valuation Date and before the Determination Date
are not included to the extent that they are already included in the
Participant’s Single Sum Benefit as of the Valuation Date.

With respect to “unrelated” rollovers and plan-to-plan transfers (those which
are both initiated by an employee and made from a plan maintained by one
employer to a plan maintained by another employer), if such a rollover or
plan-to-plan transfer is made from this Plan, it will be considered as a
distribution for purposes of this section. If such a rollover or plan-to-plan
transfer is made to this Plan, it will not be considered as part of the
Participant’s Single Sum Benefit. However, an unrelated rollover or plan-to-plan
transfer accepted before January 1, 1984, will be considered as part of the
Participant’s Single Sum Benefit.

With respect to “related” rollovers and plan-to-plan transfers (those which are
either not initiated by an employee or are made from one plan to another plan
maintained by the same employer), if such a rollover or plan-to-plan transfer is
made from this Plan, it will not be considered as a distribution for purposes of
this section. If such a rollover or plan-to-plan transfer is made to this Plan,
it will be considered as part of the Participant’s Single Sum Benefit.

1-14

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(g)

Present Value of Accrued Benefit

In the case of the defined benefit plan, a Participant’s Present Value of
Accrued Benefit, for Top-Heavy determination purposes, will be determined using
the following rules:

(1)

The Present Value of Accrued Benefit will be determined as of the most recent
“Valuation Date” within a 12-month period ending on the Determination Date.

(2)

For the first Plan Year, the Present Value of Accrued Benefit will be determined
as if (A) the Participant terminated service as of the Determination Date; or
(B) the Participant terminated service as of the Valuation Date, but taking into
account the estimated Present Value of Accrued Benefits as of the Determination
Date.

(3)

For any other Plan Year, the Present Value of Accrued Benefit will be determined
as if the Participant terminated service as of the Valuation Date.

(4)

The Valuation Date must be the same date used for computing the defined benefit
plan minimum funding costs, regardless of whether a calculation is performed
that plan year.

(5)

A Participant’s Present Value of Accrued Benefit as of a Determination Date will
be the sum of:

(A)

The present value of his Accrued Benefit determined using the actuarial
assumptions which are specified below; plus

(B)

Any Plan Distributions made within the Plan Year that includes the Determination
Date or within the four preceding Plan Years; plus

(C)

Any employee contributions, whether voluntary or mandatory. However, amounts
attributable to qualified voluntary employee contributions, as defined in
section 219(e)(2) of the Code will not be considered to be a part of the
Participant’s Present Value of Accrued Benefit.

For purposes of this section, the present value of a Participant’s Accrued
Benefit will be determined using the actuarial assumptions which are specified
for Actuarial Equivalent purposes.

(6)

Solely for the purpose of determining if this Plan (or any other plan included
in a Required Aggregation Group of which this Plan is a part) is Top-Heavy, the
Accrued Benefit of any Employee other than a Key Employee will be determined
under:

(A)

The method, if any, that uniformly applies for accrual purposes under all plans
maintained by the Employer or any Related Employer; or

(B)

If there is no such method, as if the benefit accrued no more rapidly than the
slowest accrual rate permitted under the fractional accrual rate of section
411(b)(1)(C) of the Code.

(h)

Single Sum Benefit

The Single Sum Benefit for any Participant in a defined benefit pension plan
will be equal to his Present Value of Accrued Benefit. The Single Sum Benefit
for any Participant in a defined contribution plan will be equal to his
Aggregate Account.

(i)

Top-Heavy Group

Top-Heavy Group means an Aggregation Group in which, as of the Determination
Date, the Single Sum Benefits of all Key Employees under all plans included in
the group exceeds 60% of a similar sum determined for all Participants.

1-15

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Super Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the sum of (1) the Single Sum Benefits of all Key Employees
under all defined benefit plans included in the group, plus (2) the Single Sum
Benefit of all Key Employees under all defined contribution plans included in
the group exceeds 90% of a similar sum determined for all Participants.

(j)

Top-Heavy Plan

This Plan will be a Top-Heavy Plan for any Plan Year beginning after September
30, 1983, in which, as of the Determination Date, the Single Sum Benefits of all
Key Employees exceed 60% of the Single Sum Benefits of all Participants under
this Plan.

This Plan will be a Super Top-Heavy Plan for any Plan Year beginning after
September 30, 1983, in which, as of the Determination Date, the Single Sum
Benefits of all Key Employees exceed 90% of the Single Sum Benefits of all
Participants under this Plan.

If any Participant is a Non-Key Employee for a given Plan Year, but was a Key
Employee for any prior Plan Year, the Participant’s Single Sum Benefit will not
be taken into account for purposes of determining whether this Plan is a
Top-Heavy or Super Top-Heavy Plan (or whether any Aggregation Group which
includes this Plan is a Top-Heavy or Super Top-Heavy Group).

If an individual has performed no services for the Employer at any time during
the 5-year period ending on the Determination Date, any Single Sum Benefit of
such individual will not be taken into account for purposes of determining
whether this Plan is a Top-Heavy or Super Top-Heavy Plan (or whether any
Aggregation Group which includes this Plan is a Top-Heavy Group or Super
Top-Heavy Group).

1.52

Reserved

1.53

Trustee

The Trustee is the Employer.

1.54

Vested Accrued Benefit

A Participant’s Vested Accrued Benefit as of a given date will be equal to the
product of his Accrued Benefit multiplied by his Vested Percentage as of that
same date.

A Participant’s Vested Percentage as of a given date will be that percentage
determined in accordance with the Vesting Schedule. Notwithstanding the
preceding, an Active Participant will be 100% vested upon reaching his Normal
Retirement Age.

1.55

Vesting Schedule

A Participant’s Vested Percentage will be determined in accordance with the
following table:

 

Years of Vesting Service

 

Vested Percentage

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

 

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

Less than 5 Year

 

0%

5 Years

 

100%

Notwithstanding the foregoing, in any Plan Year in which the Plan is determined
to be a Top-Heavy Plan, the following Vesting Schedule will apply in lieu of the
Vesting Schedule provided for above:

 

Years of Vesting Service

 

Vested Percentage

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

 

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

Less than 2 Years

 

0%

2 Years

 

20%

3 Years

 

40%

4 Years

 

60%

5 Years

 

80%

6 Years or More

 

100%

1-16

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If in any subsequent Plan Year the Plan ceases to be a Top-Heavy Plan, the above
Vesting Schedule will continue to apply unless the Employer elects, by Written
Resolution, to revert to the Vesting Schedule specified at the beginning of this
section. Any such reversion will be treated as a Plan Amendment and be subject
to the restrictions contained in section 10.06.

No decrease in a Participant’s nonforfeitable percentage may occur in the event
the Plan’s status changes as Top-Heavy changes for any Plan Year. However, this
section does not apply to the Accrued Benefits of any Employee who does not have
an Hour of Service after the Plan has initially become Top-Heavy and such
Employee’s Accrued Benefits attributable to Employer contributions and
forfeitures will be determined without regard to this section.

1.56

Written Resolution

The terms Written Resolution and Written Consent are used interchangeably and
reflect decisions, authorizations, etc. by the Employer. A Written Resolution
will be evidenced by a resolution of the Board of Directors of the Employer.

1.57

Years of Service

(a)

Crediting Years of Service

Years of Service are determined using the Elapsed Time Method for purposes of
vesting and benefit accrual and the Hours of Service Method for purposes of
eligibility as specified in this section.

(1)

Elapsed Time Method

Under the Elapsed Time Method, Years of Service are based upon an Employee’s
Elapsed Time of employment irrespective of the number of hours actually worked
during such period; a Year of Service (including a fraction thereof) will be
credited for each completed 12 months of Elapsed Time which need not be
consecutive. The following terms are used in determining Years of Service under
the Elapsed Time Method:

(A)

Date of Severance (Termination) - means the earlier of (i) the first day of the
month coinciding with or next following the actual date an Employee resigns, is
discharged, dies or retires, or (ii) the first anniversary of the date an
Employee is absent from work (with or without pay) for any other reason, e.g.,
disability, vacation, leave of absence, layoff, etc.

(B)

Elapsed Time – means the total Period of Service which has elapsed between a
Participant’s Employment Commencement Date and Periods of Severance where a
One-Year Break-in-Service does not occur.

The severance from service date of an Employee who is absent from service beyond
the first anniversary of the first day of absence by reason of a maternity or
paternity is the second anniversary of the first day of such absence.

(C)

Employment Commencement Date - means the date an Employee first performs one
Hour of Service for the Employer.

(D)

One Year Break-in-Service - means any 12-month period following an Employee’s
Date of Severance as defined above in which the Employee does not complete at
least one Hour of Service.

1-17

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In the case of an individual who is absent from work for maternity or paternity
reasons, the 12-consecutive month period beginning on the first anniversary of
the first date of such absence shall not constitute a Break-in-Service. The
period between the first and second anniversaries of the first day of absence
from work by reason of maternity or paternity reasons is neither a period of
service nor a Break-in-Service. For purposes of this paragraph, an absence from
work for maternity or paternity reasons means an absence (1) by reason of the
pregnancy of the individual, (2) by reason of the birth of a child of the
individual, (3) by reason of the placement of a child with the individual in
connection with the adoption of such child by such individual, or (4) for
purposes of caring for such child for a period beginning immediately following
such birth or placement.

(E)

Period of Service – means the aggregate of all periods commencing with the
Employee’s first day of employment or reemployment with the Employer and ending
on the date a 1-Year Break in Service begins. The first day of employment or
reemployment is the first day the Employee performs an Hour of Service. A
month/day of service will be credited for each month/day in which the Employee
performs an Hour of Service. An Employee will also receive partial credit for
any Period of Service of less than 12 consecutive months. Fractional periods of
a year will be expressed in terms of months.

(F)

Period of Severance - is the time between the actual Date of Severance as
defined above and the subsequent date, if any, on which the Employee performs an
Hour of Service.

All periods of employment will be aggregated including Periods of Severance
unless there is a One-Year Break-in-Service.

(2)

Hours of Service Method

Under the Hours of Service Method, a Year of Service is credited for each 12
consecutive month Computation Period during which an Employee is credited with a
specified number of Hours of Service. The specified number of Hours of Service
is provided in the applicable section(s) below.

(b)

For Eligibility Purposes

Years of Service for purposes of eligibility to participate in the Plan are
referred to as Years of Eligibility Service and are determined using the Hours
of Service Method.

A Year of Eligibility Service is credited for each Computation Period during
which an Employee is credited with at least 1,000 Hours of Service. The initial
Computation Period is the 12 consecutive month period beginning with the
Employee’s Employment Commencement Date. Thereafter, the Computation Period is
the Plan Year beginning with the Plan Year in which the initial Computation
Period ends.

All of an Employee’s Years of Eligibility Service are taken into account in
determining his eligibility to participate.

(c)

For Benefit Purposes

Years of Service for purposes of computing a Participant’s Normal Retirement
Benefit are referred to as Years of Benefit Service and are determined using the
Elapsed Time Method.

All of a Participant’s Years of Benefit Service are taken into account in
determining his Normal Retirement Benefit except:

(A)

Service prior to a Participant’s Entry Date;

(B)

Service while the Employee was not in an Eligible Employee Classification;

(C)

Service while the Employee was an employee of a Related Employer which is not an
Employer or a Participating Employer under this Plan; and

(D)

Service for which the Employee was not entitled to receive Compensation.

(E)

Service while the Employee declined participation in this Plan or any
Predecessor Plan;

1-18

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

Years of Benefit Service prior to the effective date of this restatement of the
Plan are equal to the Years of Benefit Service credited under the Plan in effect
prior to the effective date of this restatement.

(d)

For Vesting Purposes

Years of Service for purposes of computing a Participant’s Vested Percentage are
referred to as Years of Vesting Service and are determined using the Elapsed
Time Method.

All of a Participant’s Years of Vesting Service are taken into account in
determining his Vested Percentage except that portion of an Employee’s period of
service with the Employer which is prior to the Employee’s attainment of age
eighteen (18).

Years of Vesting Service prior to the effective date of this restatement of the
Plan are equal to the Years of Vesting Service credited under the Plan in effect
prior to the effective date of this restatement.

(e)

Loss of Service

If a Participant who is zero percent vested terminates employment and incurs at
least five consecutive One Year Breaks-in-Service, he or she will lose all prior
Eligibility Service, Vesting Service and Benefit Service.

A Former Participant who has received a Cash-Out Distribution will lose all
prior Benefit Service unless the service is reinstated as provided by section
5.05.

(f)

Qualified Military Service

Effective December 12, 1994, notwithstanding any provision in the Plan to the
contrary, the Plan will provide contributions, benefits and service credit with
respect to qualified military service in accordance with Code Section 414(u).

(g)

Former Schenectady Federal Savings Bank Employees

Effective September 3, 1999 for any employee who was employed by the Former
Schenectady Federal savings Bank on September 2, 1999 and who became an Employee
of the Employer on September 3, 1999 (“Former Schenectady Federal Savings Bank
Employee”), all service with the Former Schenectady Federal Savings Bank is
recognized for eligibility to participate, Years of Vesting Service, and Years
of Benefit Service. Employment with the Former Schenectady Federal Savings Bank
shall be included in determining a Participant’s Years of Benefit Service under
the thirty (30) year maximum set forth in Appendix B, Section B.1.

(h)

Former Cohoes Savings Bank Employees

Effective on the date that Cohoes Savings Bank merged with and into the
Employer, an employee who is employed by Cohoes Savings Bank on the day
immediately preceding the merger shall become an Employee of the Employer on the
merger date. Employment with Cohoes Savings Bank shall be deemed employment with
the Employer for purposes of determining eligibility to participate under the
Plan and Years of Vesting Service.

1-19

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

ARTICLE 2

PARTICIPATION

2.01

Participation

An Employee will become eligible to participate in the Plan on the Entry Date
which coincides with or next follows the attainment of age 21 and the completion
of 1 year of Eligibility Service.

Commencing November 13, 1989, any Employee who was employed by The Dime Savings
Bank of New York (“Dime Savings Bank”) immediately preceding his employment with
the Employer shall have his employment with the Dime Savings Bank deemed
employment with the Employer for purposes of determining if the Employee
satisfied the Year of Eligibility Service requirement.

Commencing August 22, 1994, any Employee who was employed by the branch of
Rhinebeck Savings Bank (“Rhinebeck”) that was purchased by the Employer on
August 22, 1994, and which immediately preceded the Employee’s employment with
the Employer, shall have such employment with Rhinebeck deemed employment with
the Employer for purposes of determining if the Employee satisfied the Year of
Eligibility Service requirement.

Effective September 3, 1999, any Former Schenectady Federal Savings Bank
Employee who was a participant in the Former Schenectady Federal Savings Bank
Retirement Plan in RSI Retirement Trust becomes a Participant in the Plan. In
addition, as of such date, all other Former Schenectady Federal Savings Bank
Employees shall be eligible to participate in the Plan and shall become Plan
Participants upon meeting the eligibility requirements set forth in Article 2.
For purposes of determining if a Former Schenectady Federal Savings Bank
Employee satisfied the Year of Eligibility Service requirement, employment with
the Former Schenectady Federal Savings Bank shall be deemed employment with the
Employer.

2.02

Participation After Reemployment

(a)

Employee Terminated Prior to Entry Date

An Employee who has satisfied all of the eligibility requirements but terminates
employment prior to his Entry Date and has not lost his Eligibility Service
under the Loss of Service provisions of section 1.57 will participate in the
Plan on the Entry Date which coincides with or next follows his return to the
employ of the Employer.

(b)

Active Participant

An Active Participant who terminates employment and is re-employed prior to
incurring a Break-in-Service will be treated as though he never terminated
employment.

(c)

Former Participant

A Former Participant who was zero percent (0%) vested or received a Cash-Out
Distribution at the time he terminated employment and who has not lost his
Eligibility Service under the Loss of Service provisions of section 1.57 will
participate in the Plan immediately upon returning to the employ of the
Employer.

A Former Participant who was zero percent (0%) vested or received a Cash-Out
Distribution at the time he terminated employment and who has lost his
Eligibility Service under the Loss of Service provisions of section 1.57(e) will
participate in the Plan under the provisions of section 2.01.

(d)

Vested Terminated Participant

A Terminated Vested Participant will participate in the Plan under the
provisions of section 2.01.

2-1

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

(e)

Retired Participant

A Retired Participant who returns to the employ of the Employer prior to his
Normal Retirement Date and completes at least forty (40) Hours of Service in a
calendar month shall have his benefits suspended under section 3.10 and will
participate as an Active Participant in the Plan immediately upon returning to
the employ of the Employer.

A Retired Participant who returns to the employ of the Employer after his Normal
Retirement Date and completes at least forty (40) Hours of Service in a calendar
month shall have his benefits suspended under section 3.10, unless such
suspension is prohibited by IRC 401(a)(9), and will participate as an Active
Participant in the Plan on the first of the month for which his benefits are
suspended (or would have been suspended but for IRC 401(a)(9).

A Retired Participant who returns to the employ of the Employer and does not
complete forty (40) Hours of Service in a calendar month shall not have his
benefits suspended under section 3.10 and will not participate as an Active
Participant in the Plan.

2.03

Change in Employment Classification

A Participant who becomes ineligible to participate because he is no longer a
member of an Eligible Employee Classification, will participate immediately upon
his return to an Eligible Employee Classification.

If an Employee who was not a member of an Eligible Employee Classification
becomes a member of such a classification, he will participate in the Plan under
the provisions of section 2.01.

2.04

Participation Waiver

An Employee who is eligible to participate as of the Effective Date or any given
Entry Date will automatically become a Participant as of such date.

2.05

Reserved

2.06

Reserved

2.07

Reserved

2.08

Reserved

2-2

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

ARTICLE 3

RETIREMENT BENEFITS

3.01

Normal Retirement

When an Active Participant reaches his Normal Retirement Date, he may elect to
retire and he will begin to receive the Normal Retirement Benefit to which he is
entitled hereunder. Upon attainment of his Normal Retirement Age, an Active
Participant’s Normal Retirement Benefit will become nonforfeitable. The
provisions of section 3.06 will govern the form of benefit payment.

In the case of any Former Schenectady Federal Savings Bank Retirement Plan
Participant hired by the Former Schenectady Federal Savings Bank prior to
January 1, 1999, a Cost-of-Living Adjustment shall apply, as described in
Section B.2 of Appendix B, provided such Former Schenectady Federal Savings Bank
Retirement Plan Participant is eligible as described in Appendix B.

(a)

Normal Retirement Benefit

A Participant’s Normal Retirement Benefit is the monthly pension benefit
commencing on his Normal Retirement Date payable in the Normal Benefit Form in
an amount equal to 1/12th of the following, except as otherwise provided to
Former Schenectady Federal Savings Bank Retirement Plan Participants in Section
B.1 of Appendix B:

(a)

For Participants whose employment with the Employer terminated prior to July 15,
1995:

The annual Normal Retirement Benefit shall be equal to 2% of the Participant’s
Average Annual Compensation multiplied by the number of years and any fraction
thereof of his Years of Benefit Service. Prior to January 1, 1989, a
Participant’s annual benefit attributable to Employer contributions shall be
limited to 60% of his Average Annual Compensation.

Effective January 1, 1989, a Participant’s annual benefit attributable to
Employer contributions shall be equal to 2% of his Average Annual Contribution
multiplied by the number of years and any fraction thereof of his Year of
Benefit Service up to a maximum of thirty (30) years, plus, ½% of his Average
Annual Compensation multiplied by the number of years and any fraction thereof
of his Years of Benefit Service in excess of thirty (30) years.

(b)

For Participants whose employment with the Employer terminates on or after July
15, 1995:

If the Participant’s Years of Benefit Service as of July 14, 1995 is 30 years or
less:

(i) An annual Normal Retirement Benefit equal to 2% of the Participant’s Average
Annual Compensation multiplied by the number of years and any fraction thereof
of his Years of Benefit Service up to a maximum of thirty (30) years: or

If the Participant’s Years of Benefit Service as of July 14, 1995 is more than
30 years:

(ii) An annual Normal Retirement Benefit equal to 2% of his Average Annual
Compensation multiplied by the number of years and fraction thereof of his Years
of Benefit Service up to a maximum of thirty (30) years, plus ½% of his Average
Annual Compensation multiplied by the number of years and any fraction thereof
of his Years of Benefit Service in excess of thirty (30) years.

Notwithstanding the foregoing, a Participant’s annual Normal Retirement Benefit
shall not be less than the greater of (a) the greatest Early Retirement Benefit
which the Participant would have been entitled to receive had he retired at an
earlier date, or (b) the benefit preserved under the prior plan.

(b)

Normal Benefit Form

The Normal Benefit Form for a Participant on the date benefits commence is a
Lifetime Pension if the Participant does not have a spouse, or a Joint & 50%
Survivor Pension if the Participant is married.

3-1

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

3.02

Early Retirement

The form of payment of a Participant’s Early Retirement Benefit will be governed
by the provisions of section 3.06.

(a)

Early Retirement Date

A Participant’s Early Retirement Date is the date, which is so elected by the
Participant for the commencement of monthly pension benefits prior to his Normal
Retirement Date. A Participant may select an Early Retirement Date as the first
day of the month which coincides with or next follows the date upon which he
satisfies the following requirements:

(1)

Termination of employment after the completion of 5 Years of Vesting Service and
the attainment of age 60; or

(2)

Termination of employment after the completion of 5 Years of Vesting Service and
the sum of his attained age and Years of Vesting Service with the Employer and
any other Participating Employer equals or exceeds seventy-five (75) years.

(b)

Early Retirement Benefit

A Participant’s annual Early Retirement Benefit shall be determined in
accordance with the provisions of Section 3.1 but shall recognize only that
Compensation and Years of Benefit Service accrued by the participant prior to
his date of severance.

If the Participant’s Termination of Service occurs on or after his attainment of
age sixty-two (62) and his completion of five (5) or more Years of Benefit
Service, the annual Early Retirement Benefit shall be equal to the Early
Retirement Benefit payment deferred to his Normal Retirement Date.

When a Participant’s Termination of Service occurs prior to his attainment of
age sixty-two (62) and his completion of five (5) Years of Benefit Service, the
annual Early Retirement Benefit payable to such Participant shall be equal to
the greater of (i) the Early Retirement Benefit reduced by .4166% for each
calendar month that benefit payments commence prior to his attainment of age
sixty-two (62) and (ii) the Actuarial Equivalent of the Early Retirement Benefit
that would have been payable if benefit payments were deferred to his Normal
Retirement Date.

Effective September 3, 1999, eligible Former Schenectady Federal Savings Bank
Retirement Plan Participants shall be entitled to receive a special unreduced
Early Retirement Benefit, as described in Section B.5 of Appendix B.

Notwithstanding the above, effective September 3, 1999, in no event shall the
Early Retirement Benefit of a Former Schenectady Federal Savings Bank Retirement
Plan Participant be less than the amount determined in accordance with Section
B.6 of Appendix B.

(c)

Reserved

3.03

Late Retirement

The form of payment of the Participant’s Late Retirement Benefit will be
governed by the provision of section 3.06.

(a)

Late Retirement Date

If a Participant continues as an Employee or is re-employed after his Normal
Retirement Date, payment of his benefit will begin upon his Late Retirement
Date, which is the earlier of the following:

(1)

The first day of the month which coincides with or next follows the date the
Participant retires or resumes retirement; or

(2)

The Participant’s Required Beginning Date.

3-2

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

(b)

Late Retirement Benefit

Subject to the provisions of Section 3.10, as of his Late Retirement Date, a
Participant will begin to receive his Late Retirement Benefit.

The Late Retirement Benefit will be equal to the amount which is based on the
Normal Retirement Benefit formula using his Years of Benefit Service and
Compensation through his Late Retirement Date, reduced (but not below zero) by
the Actuarial Equivalent of any earlier benefit payments,

Notwithstanding the above, effective September 3, 1999, in no event shall the
Late Retirement Benefit of a Former Schenectady Federal Savings Bank Retirement
Plan Participant be less than the amount determined under this section 3.03,
modified in accordance with Section B.4 of Appendix B.

3.04

Disability Retirement

(a)

Disability Retirement Date

A Participant’s Disability Retirement Date is the first day of the month
coincident with or next following the date of severance of his employment due to
disability provided the Participant has been found to be eligible for a
Disability Retirement Benefit.

An Active Participant who has terminated his employment with the Employer, as a
result of the occurrence of a Permanent Disability, after having completed at
least ten (10) Years of Service will be eligible for a Disability Retirement
Benefit under the Plan.

(b)

Disability Retirement Benefit

An eligible Participant’s Disability Retirement Benefit is equal to the Early
Retirement Benefit with payment deferred to his Normal Retirement Date but
without any actuarial reduction of the benefit by reason of the Participant’s
failure to attain his Normal Retirement Age. Such Disability Retirement Benefit
is nonforfeitable except by reason of death or recovery from disability.

If the Participant was entitled to a Vested Accrued Benefit at the date of his
Disability he shall receive the greater of: (a) the Disability Retirement
Benefit, as calculated above, or (b) a benefit which shall be the Actuarial
Equivalent of the Vested Accrued Benefit with payment deferred to his Normal
Retirement Date.

In no event, however, shall any Disability Retirement Benefit exceed the Normal
Retirement Benefit which would have been payable had the Participant continued
in the employment of the Employer to his Normal Retirement Date with no change
in his Compensation to such age.

(c)

Permanent Disability

A Participant will be considered permanently disabled if, upon review of medical
reports deemed satisfactory for this purpose, in the opinion of the Plan
Administrator:

(1)

He is prevented from performing any substantial gainful activity;

(2)

Such disability is likely to be both continuous and permanent;

(3)

Such disability occurs on or after the Effective Date of the Plan but prior to
the Participant’s Normal Retirement Date; and

(4)

Such disability is not the result of injury or disease sustained by the
Participant subsequent to the date his employment terminated.

3-3

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

A Participant shall not be eligible to receive a Disability Retirement Benefit
if the Disability results from any of the following:

(1)

Service in the armed forces of any country for which a government disability
benefit or pension is payable; or

(2)

Chronic alcoholism or addiction to drugs unless he is receiving treatment at a
recognized institution which specializes in such treatment; or

(3)

Engaging in a felonious act or any act intended to cause injury or illness to
himself or to another person.

(d)

Proof of Disability

The Plan Administrator, before approving the payment of a Disability Retirement
Benefit, may require satisfactory proof, in the form of a certificate from a
duly licensed physician selected or approved by the Plan Administrator, that the
Participant has become permanently disabled as provided herein. Periodically,
after the commencement of the Disability Retirement Benefit, the Plan
Administrator may similarly require proof of the continued disability of the
Participant.

(e)

Recovery from Disability

If the Plan Administrator finds that a Disabled Participant is, at any time
prior to his eligibility for Normal Retirement, no longer disabled as provided
herein, the Disabled Participant’s right to a Disability Retirement Benefit will
terminate as of the date that the Plan Administrator determines that he has
recovered from disability. The Participant will be deemed to be no longer
disabled if they (a) are reemployed by the Employer, or (b) engage in any other
substantially gainful activity, except for activity deemed by the Employer to be
(i) for the primary purpose of rehabilitation or (ii) not incompatible with its
findings of total and permanent disability, or (c) have, in the opinion of the
Employer based on its review of medical evaluations, sufficiently recovered to
enable them to engage in regular employment with the Employer, such offer of
employment is made and the Participant refuses such offer, or (d) could, in the
opinion of the Employer based on its review of medical evaluations, sufficiently
recover after undergoing treatment in a rehabilitation program which would
enable them to engage in regular employment with the Employer and the
Participant refuses treatment, or (e) refuse to undergo any medical examination
requested by the Employer provided that a medical examination shall not be
required more frequently than once in any calendar year.

(1)

Disabled Participant Reemployed - If the Disabled Participant is reemployed by
the Employer upon his recovery from disability, he will immediately become an
Active Participant in the Plan upon his return to employment. All Service earned
prior to the date of his termination of employment due to disability will be
restored in full.

(2)

Participant Not Reemployed - If the Participant is not reemployed by the
Employer upon his recovery from disability and if he had a Vested Accrued
Benefit as of his date of severance of employment due to disability, he will be
entitled to the benefits described in Article 5.

Notwithstanding the above, in the case of a Former Schenectady Federal Savings
Bank Retirement Plan Participant who had become disabled under the terms of the
Former Schenectady Federal Savings Bank Retirement Plan prior to September 3,
1999 and who continues to be disabled on and/or September 3, 1999, Section B.8
of Appendix B shall apply.

3.05

Permitted Disparity Limits

The provisions contained in this Article 3 must meet the requirements of section
401(l) of the Code and all regulations issued thereunder. If either the annual
or the cumulative overall permitted disparity limit as defined in Treasury
Regulation 1.401(l)-5 would otherwise be exceeded at any time, then the benefit
otherwise payable to a Participant under this Plan will be limited to the extent
necessary to prevent such limits from being exceeded.

3-4

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Any changes in the Social Security Act after the date of a Participant’s
termination of employment will not affect his benefit under this Plan.

The Normal Retirement Benefit is subject to the overall permitted disparity
limit below.

The number of Years of Benefit Service taken into account under section 3.01 for
any Participant will not exceed the Participant’s cumulative permitted disparity
limit. The Participant’s cumulative permitted disparity limit is equal to 35
minus the number of years credited to the Participant for purposes of the
benefit formula or the accrual method under the Plan under one or more qualified
plans or simplified employee pensions (whether or not terminated) ever
maintained by the Employer, other than years for which a Participant earned a
Year of Benefit Service under the benefit formula in section 3.01. For purposes
of determining the Participant’s cumulative permitted disparity limit, all years
ending in the same calendar year are treated as the same year. If the
Participant’s cumulative permitted disparity limit is less than the period of
years specified in section 3.01, then for years after the Participant reaches
the cumulative permitted disparity limit and through the end of the period
specified in section 3.01, the Participant’s benefit will be equal to the excess
benefit percentage, or, if the Participant’s benefit after the latest
fresh-start date is not accrued under the fractional accrual rule and the Plan
does not satisfy section 411(b)(1)(F) of the Code, 133-1/3 percent of the base
benefit percentage, if lesser, times Average Annual Compensation.

Cumulative permitted disparity adjustment: If the number of the Participant’s
cumulative permitted disparity years exceeds 35, the Participant’s benefit will
be further adjusted as provided below. A Participant’s cumulative disparity
years consist of the sum of: (1) the total Years of Benefit Service a
Participant is projected to have earned under this Plan by the end of the Plan
Year containing the Participant’s Normal Retirement Age, and subsequent Years of
Benefit Service, if any, (the total not to exceed 35), and (2) the number of
years credited to the Participant for purposes of the benefit formula or the
accrual method under the Plan under one or more other qualified plans or
simplified employee pensions (whether or not terminated) ever maintained by the
Employer (other than years counted in (1)), and not including any years credited
to the Participant under such other qualified plans or simplified employee
pensions after the Participant has earned 35 Years of Benefit Service under this
Plan). For purposes of determining the Participant’s cumulative permitted
disparity limit, all years ending in the same calendar year are treated as the
same year.

If this cumulative disparity adjustment is applicable, the Participant’s benefit
will be increased as follows:

(a)

Subtract the Participant’s base benefit percentage from the Participant’s excess
benefit percentage (after modification in accordance with the paragraphs
preceding this cumulative disparity adjustment).

(b)

Divide the result in (a) by the Participant’s Years of Benefit Service under the
Plan projected to the later of Normal Retirement Age or current age, not to
exceed 35 Years of Benefit Service.

(c)

Multiply the result in (b) by the number of years by which the Participant’s
cumulative disparity years exceed 35.

(d)

Add the result in (c) to the Participant’s base benefit percentage determined
prior to this cumulative disparity adjustment.

Overall permitted disparity limit: For any Plan Year this Plan benefits any
Participant who benefits under another qualified plan or simplified employee
pension maintained by the Employer that provides for permitted disparity (or
imputes permitted disparity), the benefit for each Participant under this Plan
will be equal to the base benefit percentage times the Participant’s Average
Annual Compensation. For Participants who are projected to have earned less than
35 Years of Benefit Service under this Plan as of the end of the Plan Year in
which they attain Normal Retirement Age, (or current age, if later), the
percentage in the preceding sentence will be multiplied by a fraction (not more
than one), the numerator of which is the number of the Participant’s Years of
Benefit Service the Participant is projected to have earned under this Plan as
of the end of the Plan Year in which the Participant attains Normal Retirement
Age (or current age, if later), and the denominator of which is 35. If this
paragraph is applicable, this Plan will have a fresh-start date on the last day
of the Plan Year preceding the Plan Year in which this paragraph is first
applicable. In addition, if in any subsequent Plan Year this Plan no longer
benefits any Participant who also benefits under another qualified plan or
simplified employee pension maintained by the Employer that provides for
permitted disparity (or imputes permitted disparity), this Plan will have a
fresh-start date on the last day of the Plan Year preceding the Plan Year in
which this paragraph is no longer applicable. For purposes of determining the
Participant’s overall permitted disparity limit, all years ending in the same
calendar year are treated as the same year.

3-5

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3.06

Form of Benefit Payment

The Plan Administrator will direct the Trustee to make the payment of any
benefit provided under this Plan upon the event giving rise to such benefit
within the time prescribed by this Article. The form of benefit will be
determined as follows:

(a)

A Participant who is not married on his Annuity Starting Date will be provided a
Qualified Life Annuity unless he elects the Normal Benefit Form or an Optional
Benefit Form in writing within the 90-day period which ends on his Annuity
Starting Date. The Qualified Life Annuity will be the Actuarial Equivalent of
the Normal Benefit Form.

(b)

A Participant who is married on his Annuity Starting Date will be provided a
Qualified Joint and Survivor Annuity unless he makes a Qualified Election to
receive an Optional Benefit Form or the Normal Benefit Form. A Qualified
Election is required only if the Actuarial Equivalent lump sum benefit is less
than $5,000. The Qualified Joint and Survivor Annuity will be the Actuarial
Equivalent of the Normal Benefit Form.

If the Actuarial Equivalent lump sum benefit is greater than $5,000 (and for
distributions prior to March 22, 1999, has ever exceeded $5,000), the written
consent of the Participant’s spouse must be witnessed in a manner required for a
Qualified Election.

For Plan Years beginning prior to August 5, 1997, the $5,000 dollar limit will
read $3,500 wherever it appears in this Section.

However, notwithstanding anything to the contrary, if the present value of a
Participant’s Vested Accrued Benefit does not exceed $5,000 and for
distributions prior to March 22, 1999, has never exceeded $5,000, the Plan
Administrator will direct the immediate distribution of the present value of the
Vested Accrued Benefit to the Participant. This paragraph will not apply after
the Annuity Starting Date.

For Plan Years beginning prior to August 5, 1997, the $5,000 dollar limit will
read $3,500 wherever it appears in this Section.

3.07

Optional Benefit Forms

Optional forms of benefit distribution are available subject to a written
request by the Participant (or, upon the Participant’s death, the Participant’s
Surviving Spouse or Beneficiary). The following Optional Benefit Forms are
available and equal to the Actuarial Equivalent of the Normal Benefit Form and
may be in an amount more than or less than that provided by the Normal Benefit
Form depending on the option selected. Such distribution may be in one of the
following forms:

(a)

Lifetime Pension - monthly pension benefit payable for the lifetime of the
Participant with payments terminating upon the death of the Participant.

(b)

Lifetime Pension, five (5), ten (10), or fifteen (15) Years Certain - monthly
pension benefit payable for the lifetime of the Participant with payments
guaranteed for a minimum of five (5), ten (10), or fifteen (15) years.

(c)

Joint & 100% Survivor Pension - monthly pension benefit payable during the joint
lifetime of the Participant and the Participant’s Spouse or designated
beneficiary; with the same amount continuing upon the death of the Participant.

3-6

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(d)

Joint & 75% Survivor Pension - monthly pension benefit payable during the joint
lifetime of the Participant and the Participant’s Spouse or designated
beneficiary; reduces to 75% of the original amount upon the death of the
Participant.

(e)

Joint & 66 2/3% Survivor Pension - monthly pension benefit payable during the
joint lifetime of the Participant and the Participant’s Spouse or designated
beneficiary; reduces to 66 2/3% of the original amount upon the death of the
Participant.

(f)

Joint & 50% Survivor Pension - monthly pension benefit payable during the joint
lifetime of the Participant and the Participant’s Spouse or designated
beneficiary; reduces to 50% of the original amount upon the death of the
Participant.

(g)

Joint & 33 1/3% Survivor Pension - monthly pension benefit payable during the
joint lifetime of the Participant and the Participant’s Spouse or designated
beneficiary; reduces to 33 1/3% of the original amount upon the death of the
Participant.

Effective September 3, 1999, any Former Schenectady Federal Savings Bank
Retirement Plan Participant, may additionally elect to receive benefit payments
in the form specified in Section B.9 of Appendix B. Benefits under any optional
form other than a Lifetime Pension shall be the Actuarial Equivalent of those
benefits which would have been provided as a Lifetime Pension.

3.08

Commencement of Benefit

Subject to the provisions of this Article, commencement of a benefit will,
unless the Participant elects otherwise in writing, begin not later than the
60th day after the close of the Plan Year in which occurs the latest of:

(a)

The date on which the Participant attains age sixty-five (65);

(b)

The date the Participant terminates his service with the Employer; or

(c)

The 10th anniversary of the Participant’s Participant date of participation.

(1)

Effective for Plan Years beginning before October 1, 1998. Any other provision
of this Plan to the contrary notwithstanding, and consistent with the provisions
of Section 401(a)(9) of the Internal Revenue Code and Regulations issued
pursuant thereto, the entire interest in this Plan of each Participant, as of
the last day of the calendar year in which he attains age 70½ and each
succeeding calendar year shall be distributed to him, in accordance with the
provisions of Article 3 hereof, commencing not later than the first day of April
following the calendar year in which he attains age 70½ and each calendar year
thereafter; provided, however that a Participant who has attained age 70½ prior
to January 1, 1988 and has not been a 5% owner in the Plan Year ending with or
within the calendar year in which he attains age 66½ or any succeeding Plan
Year, may defer the distribution of his benefit until he separates from service.

(2)

Effective for Plan Years beginning after October 1, 1998. Any other provision of
this Plan to the contrary notwithstanding, and consistent with the provisions of
Section 401(a)(9) of the Internal Revenue Code and Regulations issued pursuant
thereto, payment will commence in this Plan of each Participant, as of the last
day of the later of the calendar year in which he attains age 70½ or the
calendar year in which he retires, and each succeeding calendar year shall be
distributed to him, in accordance with the provisions of Article 3 hereof,
commencing not later than the first day of April following the calendar year in
which he retires and each calendar year thereafter; provided, however that for
any Participant who is a 5% owner in the Plan Year ending with or within the
calendar year in which he attains age 70½ or any succeeding plan year, payment
will commence in this Plan of each such Participant, as of the last day of the
calendar year in which he attains age 70½ and each succeeding calendar year
shall be distributed to him, in accordance with the provisions of Article 3
hereof, commencing not later than the first day of April following the calendar
year in which he attains age 70½ and each calendar year thereafter.

3-7

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3.09

Directed Transfer of Eligible Rollover Distributions

(a)

General

This section applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary that would otherwise
limit a Distributee’s election under this section, a Distributee may elect, at
the time and in the manner subject to the administrative rules prescribed by the
Plan Administrator, to have any portion of an Eligible Rollover Distribution
paid directly to an Eligible Retirement Plan specified by the Distributee in a
Direct Rollover.

(b)

Eligible Rollover Distribution

An Eligible Rollover Distribution is any distribution of all or any portion of
the balance to the credit of the Distributee, except that an Eligible Rollover
Distribution does not include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the Distributee or the joint lives (or
joint life expectancies) of the Distributee and the Distributee’s designated
beneficiary, or for a specified period of ten years or more; any distribution to
the extent such distribution is required under section 401(a)(9) of the Code;
and the portion of any distribution that is not includible in gross income
(determined without regard to the exclusion for net unrealized appreciation with
respect to employer securities).

(c)

Eligible Retirement Plan

An Eligible Retirement Plan is an individual retirement account described in
section 408(a) of the Code, an individual retirement annuity described in
section 403(a) of the Code, or a qualified trust described in section 401(a) of
the Code, that accepts the Distributee’s Eligible Rollover Distribution.
However, in the case of an Eligible Rollover Distribution to the surviving
spouse, an Eligible Retirement Plan is an individual retirement account or
individual retirement annuity.

(d)

Distributee

A Distributee includes an Employee or former Employee. In addition, the
Employee’s or former Employee’s surviving spouse and the Employee’s or former
Employee’s spouse or former spouse who is the alternate payee under a qualified
domestic relations order, as defined in section 414(p) of the Code, are
Distributee’s with regard to the interest of the spouse or former spouse.

(e)

Direct Rollover

A Direct Rollover is a payment by the Plan to the Eligible Retirement Plan
specified by the Distributee.

3.10

Suspension of Benefits after Commencement of Benefits

If a Participant is reemployed as an Employee after the commencement of a
retirement benefit under any of the provisions of the Plan, payment of the
Participant’s monthly retirement benefit shall be suspended for each calendar
month during which the Participant completes 100 Hours of Service or, for a
Participant who continues employment beyond his Normal Retirement Date, ERISA
Section 203(a)(3)(b) Service as defined below, until he subsequently terminates
his active employment with the Employer, subject to the following requirements:

(a)

Prior to such suspension, each Participant whose monthly retirement benefit is
suspended under section 3.10 shall be notified of the suspension. The
notification shall be made by personal delivery or first class mail during the
first calendar month or payroll period (if applicable) in which the
Participant’s monthly retirement benefit is suspended. The notification shall
contain the following information (either expressly or by reference to the
Plan’s Summary Plan Description):

(1)

A description of the specific reasons why benefit payments are suspended;

(2)

A general description and copy of the Plan provisions relating to the suspension
of benefit payments;

(3)

A statement that applicable Department of Labor Regulations may be found in
section 2530.203.3 of the Code of Federal Regulations; and

3-8

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(4)

A description of the Plan’s claims procedure for affording review of the
suspension of benefits.

(b)

After a Participant’s retirement benefit commences, such Participant’s monthly
retirement benefit may be suspended under section 3.10 for each month or, if
applicable, during each four or five-week payroll period ending in a calendar
month during which the Participant completes 100 Hours of Service or ERISA
Section 203(a)(3)(b) Service as the case may be. During each calendar month or
payroll period (if applicable) in which a Participant meets the preceding
requirements, he shall be deemed to be in the service of the Employer for
purposes of this section. A Participant who does not perform 100 Hours of
Service or ERISA Section 203(a)(3)(b) Service as the case may be during any
calendar month or payroll period (if applicable) shall be deemed to have
terminated employment with the Employer and, as a result, shall be entitled to a
monthly retirement benefit in accordance with section 3.10(c).

(c)

Upon the actual retirement of a Participant who does not complete 100 Hours of
Service or ERISA Section 203(a)(3)(b) Service as the case may be in any calendar
month or payroll period (if applicable) pursuant to 3.10(b) above, such
Participant’s monthly retirement benefit shall be determined in accordance with
Section 3.03. Payment of such Participant’s monthly retirement benefit will
commence no later than the first day of the third calendar month after the
calendar month in which the Participant ceases to be employed for 100 Hours of
Service or in ERISA Section 203(a)(3)(b) Service as the case may be.

In the event the Plan has not recovered amounts which should not have been paid
under this Section before such third calendar month, the Participant’s monthly
retirement benefit will be reduced by 25% until such amounts are recovered. The
Plan shall recover all amounts attributable to a delay in the suspension of
benefits pending notice in subparagraph (a) above.

The initial payment upon resumption shall include the payment scheduled to occur
in the calendar month when payment resume and any amounts withheld during the
period between the cessation of 100 Hours of Service or ERISA Section
203(a)(3)(b) Service as the case may be and the resumption of payments.

(d)

For purposes of section 3.10, “ERISA Section 203(a)(3)(b) Service” means service
during a calendar month, or during a four or five-week payroll period in which
the Participant is credited with at least forty (40) Hours of Service.

(e)

Where benefits are suspended under section 3.10, the suspended amount shall be:

(1)

In the case of benefits payable periodically on a monthly basis for as long as a
life (or lives) continues, such as a straight life annuity or a qualified joint
and survivor annuity, an amount equal to the portion of a monthly benefit
payment derived from employer contributions.

(2)

In the case of a benefit payable in a form other than the form described in
section 3.10(e)(1), an amount of the Employer-provided portion of the benefit
payments for a calendar month in which the employee who completed 100 Hours of
Service or ERISA Section 203(a)(3)(b) Service, equal to the lesser of:

(A)

The amount of benefits which would have been payable to the Employee if he had
been receiving monthly benefits under the Plan since actual retirement based on
a straight life annuity commencing at actual retirement age; or

(B)

The actual amount paid or scheduled to be paid to the Employee for such month.
Payments, which are scheduled to be, paid less frequently than monthly may be
converted to monthly payments for purposes of the preceding sentence.

(f)

This section 3.10 does not apply to the minimum benefit to which the Participant
is entitled under the top-heavy rules of Article 6.

3-9

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ARTICLE 4

DEATH BENEFIT

4.01

Pre-Retirement Death Benefit

The following benefits shall be paid automatically upon a Participant’s death:

(a)

Preretirement Survivor Annuity

(i)

The Eligible Beneficiaries of an Eligible Participant shall be entitled to
receive a monthly Preretirement Survivor Annuity.

For purposes of this section, the following definitions shall apply:

“Eligible Beneficiaries” shall mean:

(A)

Surviving Spouse – a spouse to whom the Participant was legally married for at
least one (1) year and which marriage had not been dissolved by formal divorce
proceeding at the time of his death.

(B)

Eligible Children - any natural child or children of the Participant or any
child or children legally adopted by the Participant at least one (1) year prior
to the Participant’s death who have not attained the age of twenty-one (21) at
the time of the Participant’s death.

Eligible Participant – a participant who at the time of his death was employed
by the Employer and (I) attained age sixty (60) or (II) the sum of whose
attained age and vested service equals or exceeds sixty-five (65) years or (c)
is entitled to a vested retirement benefit.

(ii)

Upon the death of an Eligible Participant, a monthly Preretirement Survivor
Annuity shall be paid to and for the life of the Surviving Spouse. If there is
no such Surviving Spouse at the time of the Participant’s death or if the
Surviving Spouse subsequently dies, the monthly benefit shall be divided equally
among, and paid to, Eligible Children who at the date of any such payment shall
have not attained age twenty-one (21). The Preretirement Survivor Annuity shall
be paid as follows:

(A)

The monthly Preretirement Survivor Annuity payments to the Surviving Spouse
shall commence on the first day of the calendar month coinciding with or next
following the later of the date of the Eligible Participant’s death and the date
on which the Eligible Participant would have attained his Normal Retirement Age,
if he had lived. Such benefit shall equal the Vested Accrued Benefit deferred to
the Eligible Participant’s Normal Retirement Date that would have been provided
under the Plan had the Eligible Participant retired on the date of his death. In
calculating the amount of such benefit, it will be assumed that the Eligible
Participant had effectively elected on the date of his death to receive a 100%
Joint & Survivor Annuity with his Surviving Spouse as his Beneficiary.

(B)

An Eligible Participant’s Surviving Spouse may elect that payment of the monthly
Preretirement Survivor Annuity shall commence on the first day of the calendar
month coincident with or next following the date of the Eligible Participant’s
death. In calculating the amount of benefit it will be assumed that the Plan
provisions permitted early retirement as early as the date of the Eligible
Participant’s death, and that the Eligible Participant had effectively elected
on the date of his death to receive an immediate 100% Joint & Survivor Annuity
with his Surviving Spouse as his Beneficiary.

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(C)

If (I) the Eligible Participant has a Surviving Spouse and Eligible Children on
the date of his death, (II) payment to the Surviving Spouse have commenced,
(III) the Surviving Spouse dies, and (IV) there are Eligible Children who have
not attained age twenty-one (21) at the time of the Surviving Spouse’s death,
the same monthly Preretirement Survivor Annuity that was payable to the
Surviving Spouse shall continue to be paid to such Eligible Children until the
youngest child attains age twenty-one (21). Such benefit shall commence on the
first day of the calendar month coincident with or next following the date of
the Surviving Spouse’s death and shall be divided equally among, and paid to,
the Eligible Children who, on the date of such payment, shall have not attained
age twenty-one (21).

(D)

If (I) the Eligible Participant has a Surviving Spouse and Eligible Children on
the date of his death, (II) payment to the Surviving Spouse are deferred until
the Eligible Participant would have attained Normal Retirement Age, (III) the
Surviving Spouse dies prior to commencement, and (IV) there are Eligible
Children who have not attained age twenty-one (21) at the time of the Surviving
Spouse’s death, a monthly Preretirement Survivor Annuity shall be payable to
such Eligible Children. Such benefit shall commence on the first day of the
calendar month coincident with of next following the date of the Surviving
Spouse’s death and shall be divided equally among, and paid to, the Eligible
Children who, on the date of such payment, shall not have attained age
twenty-one (21). The benefit will be calculated assuming that the Eligible
Participant had effectively elected on his date of death to receive a 100% Joint
& Survivor Annuity with his Surviving Spouse as the Beneficiary with payments to
commence on the date of his Surviving Spouse’s death and to continue until the
youngest child attains age twenty-one (21) and the Plan provisions permitted
early retirement as early as the date of the Surviving Spouse’s death.

(E)

If the Eligible Participant has no Surviving Spouse on the date of his death but
is survived by Eligible Children a monthly Preretirement Survivor Annuity shall
be payable to such Eligible Children with payments to continue until the
youngest child attains age twenty-one (21). Such benefit shall commence on the
first day of the calendar month coincident with of next following the date of
the Eligible Participant’s death and shall be divided equally among, and paid
to, the Eligible Children who, on the date of such payment, shall not have
attained age twenty-one (21). The benefit will be calculated assuming that (I)
the Eligible Participant had effectively elected on his date of death to receive
a 100% Joint & Survivor Annuity with the designated Beneficiary thereunder being
a person of the opposite sex with the same date of birth as the Eligible
Participant, (II) the Eligible Participant had not chosen a deferred payment and
(III) the Plan provisions permitted early retirement as early as the date of the
Eligible Participant’s death.

(b)

Post Termination Survivor Annuity

(i)

A Participant who is eligible for an Early Retirement Benefit, a Normal
Retirement Benefit or a Late Retirement Benefit upon his termination of service
with the Employer and dies prior to the earliest of : (A) sixty (60) days
following termination of service, (B) the date benefit payments commence, or (C)
the effective date of any benefit election, shall be deemed not to have retired
and a Preretirement Survivor Annuity shall be payable as though his death had
occurred at the time of his termination of service.

(ii)

A Participant who is eligible for an Early Retirement Benefit, a Normal
Retirement Benefit or a Late Retirement Benefit upon his termination of service
with the Employer and dies (A) more than sixty (60) days following termination
of service and (B) prior to the earlier of: (I) the date benefit payments
commence or (II) the effective date of any benefit election shall, if he has a
Surviving Spouse, be deemed to have chosen to have benefits commence (1) if the
Participant was eligible for an Early Retirement Benefit or a Normal Retirement
Benefit, on his Normal Retirement Date, or if earlier, on the commencement date
specified in any benefit election that is in effect on the date of his death or
(2) if the Participant was eligible for a Late Retirement Benefit, on his Late
Retirement Date, and be deemed to have elected a 50% Joint & Survivor Annuity
with his Surviving Spouse as his Beneficiary. Notwithstanding the foregoing, the
Participant’s Surviving Spouse may elect to have benefits commence on the date
of the Participant’s death in which case the Participant shall be deemed to have
chosen to have benefits commence on such date and to have elected the 50% Joint
& Survivor Annuity with his Surviving Spouse as his Beneficiary.

4-2

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(iii)

If a Participant has not satisfied the eligibility requirements for an Early
Retirement Benefit but, (A) has incurred a termination of service while entitled
to a Vested Accrued Benefit, and (B) dies prior to the date his benefit payments
are scheduled to commence, he shall, if he has a Surviving Spouse, be deemed to
have elected to receive a 50% Joint & Survivor Annuity with his Surviving Spouse
as his Beneficiary and chosen to have his benefit commence on his Normal
Retirement Date; provided however that the Participant’s Surviving Spouse may
elect to have benefits commence on the earliest date following his death on
which an Early Retirement Benefit could have commenced under the provisions of
the Plan as in effect on the date the Participant incurs a termination of
service and the benefit paid to such Surviving Spouse shall be determined as if
the Participant had elected to receive a 50% Joint & Survivor Annuity with his
Surviving Spouse as his Beneficiary and had chosen to have benefits commence as
of the date elected by the Surviving Spouse.

4.02

Post-Retirement Death Benefit

In the event of the death of a Retired Participant, a benefit will be paid to
the Participant’s Beneficiary or Surviving Spouse in accordance with the form of
benefit payment elected under the Plan.

4.03

Effect of Death on Benefit Rights

The death of a Participant will result in the forfeiture of all benefits (other
than those described in this Article) to which he would have been entitled if he
had survived.

4.04

Designation of Beneficiary

Each Participant will be given the opportunity to designate a Beneficiary or
Beneficiaries, and from time to time the Participant may file with the Plan
Administrator a new or revised designation on the form provided by the Plan
Administrator. If a Participant is married, any designation of a Beneficiary
other than the Participant’s spouse must be consented to by the Participant’s
spouse pursuant to a Qualified Election.

If a Participant dies without designating a Beneficiary, or if the Participant
is predeceased by all designated Beneficiaries and contingent Beneficiaries, the
Plan Administrator will distribute all benefits which are payable in the event
of the Participant’s death in the following manner:

(a)

All to the Participant’s Surviving Spouse; or, if there is no Surviving Spouse,

(b)

The Participant’s estate.

4.05

Reserved

4.06

Reserved

4.07

Reserved

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ARTICLE 5

TERMINATION OF EMPLOYMENT

5.01

Termination of Employment

If the employment of a Participant terminates for any reason other than death,
disability or retirement, the Participant will become entitled to receive a
Normal Retirement Benefit commencing on his Normal Retirement Date equal to his
Vested Accrued Benefit. If he is entitled to receive a monthly retirement
benefit, he will be considered a Vested Terminated Participant.

In addition, effective September 3, 1999, in no event shall the Vested Accrued
Benefit of a Former Schenectady Federal Savings Bank Retirement Plan Participant
be less than the amount determined under this section 3.03, modified in
accordance with Section B.7 of Appendix B.

5.02

Payment of Vested Accrued Benefit

The monthly retirement benefit payable to a Vested Terminated Participant will
be subject to the same terms and conditions in respect to time, manner and form
of payment as any other Normal Retirement Benefit. A Vested Terminated
Participant may elect to begin to receive his Vested Accrued Benefit at any time
after he satisfies the requirements for Early Retirement, in which case his
benefit will be in the same amount and subject to the same terms and conditions
as an Early Retirement Benefit. If the Participant has satisfied the service
requirement but not the age requirement for Early Retirement, he will be
entitled to receive an Early Retirement Benefit upon later satisfaction of the
age requirement.

5.03

Cash-Out Distribution

For Plan Years beginning prior to August 5, 1997, the $5,000 dollar limit will
read $3,500 wherever it appears in this Section.

(a)

If the present value of a terminated Participant’s Vested Accrued Benefit does
not exceed $5,000, and for distribution prior to March 22, 1999, has never
exceeded $5,000 the Plan Administrator will direct the immediate distribution to
the Participant of the present value of his Vested Accrued Benefit. For purposes
of this Paragraph, any single sum benefit which is to be paid to a Participant,
must be paid before the annuity starting date which shall be determined as
follows:

(1)

The first day of the first period for which an amount is received payable as an
annuity (whether by reason of retirement or disability); or

(2)

In the case of a benefit not payable in the form of an annuity, the first day on
which all events have occurred which entitled the Participant to such benefit.

(b)

If a terminated Participant receives a complete distribution of his Vested
Accrued Benefit, a Cash-Out Distribution will be deemed to have occurred as of
the date of distribution. If a Participant who is zero percent vested in his
Accrued Benefit terminates employment, a Cash-Out Distribution will be deemed to
have occurred as of the Participant’s date of severance of employment.

(c)

If a terminated Participant receives a complete distribution of his Vested
Accrued Benefit, a Cash-Out Distribution will be deemed to have occurred as of
the date of distribution. If a Participant who is zero percent vested in his
Accrued Benefit terminates employment, a Cash-Out Distribution will be deemed to
have occurred as of the Participant’s date of severance of employment.

5.04

Forfeitures

If a Participant, who is less than 100% vested, terminates employment and either
receives a Cash-Out Distribution or incurs five consecutive One Year
Breaks-in-Service, he will forfeit the non-vested portion of his Accrued
Benefit. If the Participant subsequently returns to an Eligible Employee
Classification, he will immediately become completely reinstated with his
previously credited Years of Service.

5-1

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5.05

Reemployment

If a Participant (a) terminates employment, (b) receives a distribution of all
or a portion of his Vested Accrued Benefit and (c) is later reemployed, the
Participant’s Normal Retirement Benefit (and therefore his Accrued Benefit) will
be reduced by the Actuarial Equivalent value of the benefit which was previously
distributed. If a Participant is reemployed prior to incurring 5 consecutive
one-year Breaks-in-Service commencing after the distribution and repays the
Cash-Out Distribution or Lump Sum payment to the Plan within 5 years of
reemployment with interest at the rate specified in section 411(c)(2)(C)(iii) of
the Code, he will become completely reinstated with his previously credited Year
of Service. A Participant who has received a Cash-Out Distribution and does not
make such repayment, shall lose his Benefit Service attributable to the prior
distribution but shall retain his Eligibility and Vesting Service.

5.06

Reserved

5.07

Reserved

5.08

Reserved

5-2

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ARTICLE 6

ACCRUED BENEFIT

6.01

Accrued Benefit

(a)

General

A Participant’s Accrued Benefit represents the amount of monthly retirement
pension benefit which has been earned as of any given date.

Prior to a Participant’s Normal Retirement Date, the Accrued Benefit is
determined in accordance with section 1.01 and is payable in the Normal Benefit
Form commencing on his Normal Retirement Date. For such purposes, the
Participant’s Normal Retirement Benefit will be determined based on his Average
Annual Compensation at the time his Accrued Benefit is determined and will be
determined without regard to the limitations of Article 7.

A Participant’s Accrued Benefit at his Normal Retirement Age will be equal to
his Normal Retirement Benefit. If a Participant continues as an Employee after
his Normal Retirement Date, his Accrued Benefit will be equal to his Late
Retirement Benefit determined in accordance with section 3.03.

A Participant’s Accrued Benefit will not be reduced on account of any increase
in the Participant’s age or service.

(b)

133_% Rule

A Participant’s Accrued Benefit will be based on their Average Annual
Compensation, and Years of Benefit Service at the time of retirement, death, or
termination of employment. The Normal Retirement Benefit is the total benefit
accrued at Normal Retirement Age. In the event that the benefit commences prior
to his Normal Retirement Date, such benefit shall be reduced in accordance with
the provisions of section 3.02.

The Plan shall satisfy the 133-1/3% accrual rule set forth in section
411(b)(1)(B) of the Code.

6.02

Minimum Benefit Requirement for Top-Heavy Plan

(a)

General

For any Plan Year in which this Plan is determined to be Top-Heavy, a
Participant who is a Non-Key Employee (including any Employee who is excluded
from the Plan because his Compensation is less than a stated amount) will be
entitled to a monthly benefit equal to the greater of the Accrued Benefit
provided under section 1.01 or a monthly benefit in the form of a straight life
annuity (with no ancillary benefits) commencing at Normal Retirement Date equal
to the product of the Participant’s average monthly compensation (which will
mean the average rate of Aggregate Compensation during the 5 consecutive years,
as defined for purposes of determining Average Monthly Compensation, in which
the Participant had the highest Aggregate Compensation) multiplied by the lesser
of (1) 2% for each Year of Benefit Service performed while actually
participating in the Plan during a Plan Year in which the Plan is determined to
be Top-Heavy, or (2) 20%.

A Participant will not be required to be employed on the last day of a Plan Year
in order to be entitled to a benefit provided by this section 6.02(a). The Plan
may not satisfy the requirements of this section 6.02(a) through Employer
contributions to Social Security.

If the form of payment is other than a single life annuity, the Participant must
receive an amount that is the Actuarial Equivalent of the minimum straight life
annuity benefit. If the benefit commences at a date other than at Normal
Retirement Age, the Participant must receive at least an amount that is the
Actuarial Equivalent of the minimum straight life annuity benefit commencing at
Normal Retirement Age.

6-1

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(b)

Non-Application

Notwithstanding the provisions of section 6.02(a), if a Non-Key Employee who is
a Participant in this Plan, is also participating in a Defined Contribution Plan
maintained by the Employer or an Affiliated Employer in which, for a given Plan
Year, the annual allocation of employer contributions plus allocated forfeitures
in the Defined Contribution Plan plus the benefits under this Plan provide
expected benefits at age 65 which (when measured as a percentage of Aggregate
Compensation) are comparable to the benefit described in section 6.02(a) for the
Non-Key Employees who are covered by this Plan and the defined contribution
plan, then the Participant will not be entitled to the minimum benefit provided
for in section 6.02(a) for the Plan Year.

6-2

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ARTICLE 7

LIMITATION ON BENEFITS

7.01

Limitation on Benefits

(a)

In General

The Annual Benefit otherwise payable to a Participant under this Plan will not
at any time exceed the Defined Benefit Limit. The limitation described in this
section will be deemed satisfied as to any Participant if the Annual Benefit
otherwise payable under this Plan to the Participant does not exceed $1,000
multiplied by the Participant’s number of Years of Service or parts thereof (not
to exceed 10) with the Employer, and the Employer has not at any time maintained
a defined contribution plan, as defined in Section 7.02, in which the
Participant participated.

If the Employer maintains one or more qualified defined benefit plans in
addition to this Plan, the sum of the Annual Benefits payable under each plan
will be treated as a single Annual Benefit for the purposes of applying the
limitations hereunder. If the sum of the Annual Benefits exceeds, in the
aggregate, the Defined Benefit Limit, the Annual Benefit of each plan will be
reduced ratably until the sum of the reduced Annual Benefits satisfies the
limitations under this paragraph. To the extent one or more qualified plans
maintained by the Employer do not permit reduction, the annual Benefit of each
other Plan will be ratably reduced.

(b)

Preservation of Pre-TRA ‘86 Accrued Benefit

Any Participant’s Annual Benefit payable under the Plan will be not less than
the Participant’s Accrued Benefit determined as if he had separated from service
as of the close of the last Limitation Year beginning before January 1, 1987,
disregarding any change in the terms and conditions of the Plan after May 5,
1986 and any cost of living adjustments occurring after May 5, 1986.

7.02

Where Employer Maintains a Qualified Defined Contribution Plan

(a)

In General

For Limitation Years beginning on or before December 31, 1999, if the Employer
maintains (or has ever maintained), in addition to this Plan, one or more
qualified Defined Contribution Plans, one or more welfare benefit funds (as
defined in section 419(e) of the Code), or a simplified employee pension plan,
all of which are referred to in this Article 7 as “qualified Defined
Contribution Plans”, then the limitation described in Section 7.01 will be
further limited for such Plan Years in accordance with the provisions of Section
415(e) of the Code as in effect for limitation years beginning before January 1,
2000, incorporating any transition rules that may apply to a Participant’s
Annual Benefit and including any adjustments that may be required for a
Limitation Year in which the Plan is determined to be Top-Heavy and subject to
the requirements of Section 416 of the Code. The limitations under Section
415(e) of the Code shall not apply in Plan Years beginning on or after January
1, 2000

7.03

Definitions Applicable to Article 7

(a)

Aggregate Compensation

Aggregate Compensation means a Participant’s earned income, wages, salaries, and
fees for professional services, and other amounts received (without regard to
whether or not an amount is paid in cash) for personal services actually
rendered in the course of employment with the Employer maintaining the Plan to
the extent that the amounts are includible in gross income (including, but not
limited to, commissions paid to salesmen, compensation for services on the basis
of a percentage of profits, bonuses, fringe benefits and reimbursements or other
expense allowances under a nonaccountable plan (as described in Treas. Reg.
1.62-2(c)), and excluding the following:

7-1

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(1)

Employer contributions to a plan of deferred compensation which are not
includible in the Participant’s gross income for the taxable year in which
contributed or Employer contributions under a simplified employee pension plan
to the extent such contributions are deductible by the Participant, or any
distributions from a plan of deferred compensation;

(2)

Amounts realized from the exercise of a nonqualified stock option, or when
restricted stock (or property) held by the Participant either becomes freely
transferable or is no longer subject to a substantial risk of forfeiture;

(3)

Amounts realized from the sale, exchange or other disposition of stock acquired
under a qualified stock option; and

(4)

Other amounts which receive special tax benefits or contributions made by an
Employer (whether or not under a salary reduction agreement) towards the
purchase of an annuity contract described in Code Section 403(b) (whether or not
the contributions are actually excludible from the gross income of the
Employee).

For Plan Years beginning on or after January 1, 1998, Compensation for purposes
of this Article 7 includes any amounts contributed by the Employer or any
related Employer on behalf of any Employee pursuant to a salary reduction
agreement which are not includable in the gross income of the Employee due to
Code Section 125, 402(e)(3) (referring to salary deferral contributions under a
Code Section 401(k) plan), 402(h), 402(k), 403(b) or 457(b).

For Plan Years beginning prior to January 1, 1998, Compensation for purposes of
this Article 7 excludes any amounts contributed by the Employer or any Related
Employer on behalf of any Employee pursuant to a salary reduction agreement
which are not includible in the gross income of the Employee due to Code Section
125, 402(e)(3) (referring to salary deferral contributions under a Code Section
401(k) plan), 402(h), 402(k), 403(b) or 457(b).

Aggregate Compensation in excess of the Section 401(a)(17) Limitation (as
adjusted by the Secretary of the Treasury in accordance with section
401(a)(17)(B) of the Code) is disregarded. For any self-employed individual,
Aggregate Compensation will mean earned income.

Aggregate Compensation for any Limitation Year means the Compensation actually
paid or includible in gross income during such Limitation Year.

(b)

Allocation Date, Valuation Date

These terms are used interchangeably and mean the date with respect to which all
or a portion of employer contributions, employee contributions or forfeitures or
both are allocated to participant accounts under a defined contribution plan.

(c)

Annual Additions

For Plan Years beginning after December 31, 1986, Annual Additions are the sum
of the following amounts allocated to any Defined Contribution Plan maintained
by the Employer (including voluntary contributions to any Defined Benefit Plan
maintained by the Employer) on behalf of a Participant for a Limitation Year:

(1)

All Employee and Employer contributions;

(2)

All reallocated forfeitures;

(3)

Amounts allocated after March 31, 1984, to an individual medical account, as
defined in section 415(l)(2) of the Code which is part of a pension or annuity
plan maintained by the Employer, and amounts derived from contributions paid or
accrued after December 31, 1985, in taxable years ending after that date, which
are attributable to post-retirement medical benefits required by section
401(h)(6) of the Code to be allocated to the separate account of a Key Employee
under a welfare benefit plan (as defined in section 419(e) of the Code)
maintained by the Employer.

7-2

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Contributions or forfeitures will be treated as Annual Additions regardless of
whether they constitute Excess Deferrals, Excess Contributions or Excess
Aggregate Contributions within the meaning of the regulations under section
401(k) or 401(m) of the Code and regardless of whether they are corrected
through distribution or recharacterization. The Annual Addition for any
Limitation Year beginning before January 1, 1987, will not be recomputed to
treat all Employee contributions as Annual Additions.

(d)

Annual Benefit

Annual Benefit means a benefit payable annually in the form of a straight life
annuity (with no ancillary benefits) under a plan to which employees do not
contribute and under which no rollover contributions are made. (The Annual
Benefit does not include any benefits attributable to employee contributions or
rollover contributions, or the assets transferred from a qualified plan that was
not maintained by the Employer).

(e)

Defined Benefit Compensation Limit

The Defined Benefit Compensation Limit is equal to 100% of the Participant’s
average Aggregate Compensation for the three consecutive calendar years (or
other twelve consecutive month periods adopted by the Employer pursuant to a
Written Resolution and applied on a uniform and consistent basis) of service
during which the Participant had the greatest Aggregate Compensation.

Where the annual benefit is payable to a Participant in a form other than a
straight life annuity or a Qualified Joint and Survivor Annuity, the Defined
Benefit Compensation Limit will be the Actuarial Equivalent of a straight life
annuity beginning at the same age. No adjustment is required for the following:
pre-retirement disability benefits, pre-retirement death benefits and
post-retirement medical benefits. For purposes of this paragraph, the Actuarial
Equivalent straight life annuity shall be the greater of the straight life
annuity determined using (1) the postretirement interest and mortality
assumptions specified for Actuarial Equivalent purposes, and (2) the “Applicable
Mortality Table” determined in accordance with Section 1.03 and (a) five percent
(5%) for any form of benefit not subject to Internal Revenue Code Section
417(e)(3), or (b) for any form of benefit subject to Internal Revenue Code
Section 417(e), the “Applicable Interest Rate” determined in accordance with
Section 1.03.

Where the annual benefit is payable to a Participant who has fewer than 10 years
of service with the Employer or any Related or Predecessor Employer, the Defined
Benefit Compensation Limit will be multiplied by a fraction, the numerator of
which is the Participant’s number of years of service with the Employer or
Related or Predecessor Employer, but not less than one (1), and the denominator
of which is 10.

With regard to a Participant who has separated from service with a
nonforfeitable right to an Accrued Benefit, the Defined Benefit Compensation
Limit will be adjusted effective January 1 of each Calendar year. For any
Limitation Year beginning after the separation occurs, the Defined Benefit
Compensation Limit will be equal to the Defined Benefit Compensation Limit which
was applicable to the Participant in the Limitation Year in which he separated
from service, increased to reflect cost-of-living adjustments as promulgated by
the Secretary of the Treasury under Section 415(d)(1)(B) of the Code. However,
the Annual Benefit will not be increased above the amount which would be payable
without regard to the Defined Benefit Limit.

The benefits payable with respect to a Participant under any defined benefit
plan shall be deemed not to exceed the limitation of section 415(b)(4) if:

(a)

The retirement benefits payable with respect to such participant under such plan
and under all other defined benefit plans of the employer do not exceed $10,000
for the plan year, or for any prior plan year, and

(b)

The employer has not at any time maintained a defined contribution plan in which
the participant participated.

(f)

Defined Benefit Dollar Limit

The Defined Benefit Dollar Limit is equal to $90,000 for calendar years 1984
through 1987. As of January 1, 1988 and as of January 1 of each subsequent
calendar year, the Defined Benefit Dollar Limit is increased in accordance with
415(d)(1)(A) of the Code. However, the Annual Benefit will not be increased
above the amount which would be payable without regard to the Defined Benefit
Limit. For calendar years between 1976 and 1983, the Defined Benefit Dollar
Limit is $75,000 as adjusted by the Secretary of the Treasury under section
415(d) of the Code for that calendar year. The Defined Benefit Dollar Limit for
a calendar year applies to Limitation Years ending with or within that calendar
year.

7-3

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Where the annual benefit is payable to a Participant in a form other than a
straight life annuity or a qualified joint and survivor annuity as described in
Section 417(b) of the Code, the Defined Benefit Dollar Limit will be the
Actuarial Equivalent of a straight life annuity beginning at the same age. No
adjustment is required for the following: preretirement disability benefits,
preretirement death benefits, and postretirement medical benefits. For purposes
of this paragraph, the Actuarial Equivalent straight life annuity shall be the
greater of the straight life annuity determined using (1) the postretirement
interest and mortality assumptions specified for Actuarial Equivalent purposes,
and (2) the “Applicable Mortality Table” determined in accordance with Section
1.03 and (a) five percent (5%) for any form of benefit not subject to Internal
Revenue Code Section 417(e)(3), or (b) for any form of benefit subject to
Internal Revenue Code Section 417(e)(3), the “Applicable Interest Rate”
determined in accordance with Section 1.03.

Where the annual benefit is payable to a Participant who has fewer than 10 years
of participation in the Plan, the Defined Benefit Dollar Limit will be
multiplied by a fraction, the numerator of which is the Participant’s number of
years (or part thereof) of participation in the Plan, but not less than one (1),
and the denominator of which is 10.

For a benefit commencing before a Participant’s Social Security Retirement Age
but at or after age 62, the Defined Benefit Dollar Limit will be adjusted in a
manner which is consistent with the reduction for old-age insurance benefits
commencing before Social Security Retirement Age under the Social Security Act.
The reduction will be 5/9 of 1% for each of the first 36 months and 5/12 of 1%
for each additional month (up to 24 months) by which benefits commence before
the month of the Participant’s Social Security Retirement Age. The Defined
Benefit Dollar Limit for a benefit commencing before age 62 will be adjusted to
the Actuarial Equivalent of the Defined Benefit Dollar Limit for a benefit
commencing at age 62 reduced for each month by which benefits commence before
the month in which the Participant attains age 62. For purposes of this
paragraph, the “Actuarial Equivalent of the Defined Benefit Dollar Limit” shall
be the lesser of the amount determined using (1) the factors specified by the
Plan for determining the reduction for early retirement benefits below age 62
for a Participant with the same Years of Service, and (2) five percent (5%) and
the “Applicable Mortality Table” determined in accordance with Section 1.03.

To the extent that a forfeiture of benefits would not occur upon death of the
Participant, an assumption of no mortality shall replace the “Applicable
Mortality Table” before age 62.

For a benefit commencing after a Participant’s Social Security Retirement Age,
the Defined Benefit Dollar Limit will be adjusted to the Actuarial Equivalent of
the Defined Benefit Dollar Limit for a benefit commencing at the Participant’s
Social Security Retirement Age. For purposes of this paragraph, the “Actuarial
Equivalent of the Defined Benefit Dollar Limit” shall be the lesser of the
amount determined using (1) the factors specified by the Plan for determining
the increase in benefits after age 70½ for a Participant who continues in
employment while not receiving benefits, and (2) five percent (5%) and the
“Applicable Mortality Table” determined in accordance with Section 1.03. To the
extent that a forfeiture of benefits would not occur upon death of the
Participant, the mortality decrement will be ignored in determining the
Actuarial Equivalent.

(g)

Defined Benefit Limit

The Defined Benefit Limit is the lesser of the Defined Benefit Dollar Limit or
the Defined Benefit Compensation Limit.

(h)

Employer

For purposes of this Article 7, employer shall mean the employer that adopts
this Plan, and all members of a controlled group of corporations (as defined in
Section 414(b) of the Code, as modified by Section 415(h), all commonly
controlled trades or businesses (as defined in Section 414(c) as modified by
Section 415(h), or affiliated service groups (as defined in Section 414(m) of
which the adopting employer is a part and any other entity required to be
aggregated with the employer pursuant to Section 414(o) of the Code.

7-4

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(i)

Limitation Year

The Limitation Year will be the 12 consecutive month period which is specified
in Article 1 of this Plan and which is adopted for all qualified plans
maintained by the Employer pursuant to a Written Resolution adopted by the
Employer. In the event of a change in the Limitation Year, the additional
limitations of Treasury Regulation section 1.415-2(b)(4)(iii) will also apply.

(j)

Projected Annual Benefit

For purposes of this Section, a Participant’s Projected Annual Benefit is equal
to the Expected Retirement Benefit under Section 1.22, excluding benefits
resulting from any Participant Contributions or Rollover Contributions.

(k)

Social Security Retirement Age

Social Security Retirement Age means age 65 with respect to a Participant who
was born before January 1, 1938; age 66 with respect to a Participant born after
December 31, 1937, and before January 1, 1955; and age 67 with respect to a
Participant born after December 31, 1954.

7-5

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ARTICLE 8

MISCELLANEOUS

8.01

Employment Rights of Parties Not Restricted

The adoption and maintenance of this Plan will not be deemed a contract between
the Employer and any Employee. Nothing in this Plan will give any Employee or
Participant the right to be retained in the employ of the Employer or to
interfere with the right of the Employer to discharge any Employee or
Participant at any time, nor will it give the Employer the right to require any
Employee or Participant to remain in its employ, or to interfere with any
Employee’s or Participant’s right to terminate his employment at any time.

8.02

Alienation

(a)

General

No person entitled to any benefit under this Plan will have any right to sell,
assign, transfer, hypothecate, encumber, commute, pledge, anticipate or
otherwise dispose of his interest in the benefit, and any attempt to do so will
be void. No benefit under this Plan will be subject to any legal process, levy,
execution, attachment or garnishment for the payment of any claim against such
person.

(b)

Exceptions

Section 8.02(a) will not apply to a qualified domestic relations order (QDRO) as
defined in section 414(p) of the Code, and those other domestic relations orders
permitted to be so treated by the Plan Administrator under the provisions of the
Retirement Equity Act of 1984. The Plan Administrator will establish a written
procedure to determine the qualified status of domestic relations orders and to
administer distributions under such qualified orders. Further, to the extent
provided under a QDRO, a former spouse of a Participant will be treated as the
spouse or Surviving Spouse for all purposes under the Plan. Where, however,
because of a QDRO, more than one individual is to be treated as a Surviving
Spouse, the total amount to be paid in the form of a Qualified Survivor Annuity
or the survivor portion of a Qualified Joint and Survivor Annuity may not exceed
the amount that would be paid if there were only one Surviving Spouse. All
rights and benefits, including elections, provided to a Participant under this
Plan will be subject to the rights afforded to any alternate payee as such term
is defined in section 414(p) of the Code.

8.03

Qualification of Plan

The Employer will have the sole responsibility for obtaining and retaining
qualification of the Plan under the Code with respect to the Employer’s
individual circumstances.

8.04

Construction

(a)

Governing Law

To the extent not preempted by ERISA or any other laws of the United States,
this Plan will be construed according to the laws of the State of New York.

(b)

Gender

Words used in the singular will include the plural, the masculine gender will
include the feminine, and vice versa, whenever appropriate.

(c)

Severability

If any provision of this Plan is not enforceable, the validity of the Plan and
the remaining provisions shall not be affected.

(d)

Headings

The headings of this Plan have been inserted for convenience of reference only
and are to be ignored in any construction of its provisions.

8-1

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8.05

Named Fiduciaries

(a)

Allocation of Functions

The authority to control and manage the operation and administration of the Plan
and Trust created by this instrument will be allocated between the Plan Sponsor,
the Trustee, and the Plan Administrator, all of whom are designated as Named
Fiduciaries with respect to the Plan and Trust as provided for by Section
402(a)(2) of ERISA. The Plan Sponsor reserves the right to allocate the various
responsibilities for the present execution of the functions of the Plan, other
than the Trustees’ responsibilities, among its Named Fiduciaries. Any person or
group of persons may serve in more than one fiduciary capacity with regard to
the Plan.

(b)

Responsibilities of the Plan Sponsor

The Plan Sponsor, in its capacity as a Named Fiduciary, will have only the
following authority and responsibility:

(1)

To appoint or remove the Plan Administrator and furnish the Trustee with
certified copies of any resolutions of the Plan Sponsor with regard thereto;

(2)

To appoint and remove the Trustee;

(3)

To appoint a successor Trustee or additional Trustees;

(4)

To communicate information to the Plan Administrator and the Trustee as needed
for the proper performance of the duties of each;

(5)

To appoint an investment manager (or to refrain from such appointment), to
monitor the performance of the investment manager so appointed, and to terminate
such appointment (more than one investment manger may be appointed and in office
at any time); and

(6)

To establish and communicate to the Trustee a funding policy for the Plan.

(c)

Limitation on Obligations of Named Fiduciaries

No Named Fiduciary will have authority or responsibility to deal with matters
other than as delegated to it under this Plan or by operation of law. A Named
Fiduciary will not in any event be liable for breach of fiduciary responsibility
or obligation by another fiduciary (including Named Fiduciaries) if the
responsibility or authority of the act or omission deemed to be a breach was not
within the scope of the Named Fiduciary’s authority or delegated responsibility.

(d)

Standard of Care and Skill

The duties of each fiduciary will be performed with the care, skill, prudence
and diligence under the circumstances then prevailing that a prudent person
acting in a like capacity and familiar with such matters would use in the
conduct of an enterprise of like character and with like objectives.

8.06

Status of Insurer

The term Insurer refers to any legal reserve life insurance company licensed to
do business in the state within which the Employer maintains its principal
office. The Insurer will file such returns, keep such records, make such reports
and supply such information as required by applicable law or regulation.

8.07

Adoption and Withdrawal by Other Organizations

(a)

Procedure for Adoption

Subject to the provisions of this Section 8.07, any organization now in
existence or hereafter formed or acquired, which is not already a Participating
Employer under this Plan and which is otherwise legally eligible may, in the
future, with the consent and approval of the Plan Sponsor, by formal Written
Resolution (referred to in this Section as an Adoption Resolution), adopt the
Plan and Trust hereby created for all or any classification of persons in its
employment and thereby, from and after the specified effective date, become a
Participating Employer under this Plan. Such consent will be effected by and
evidenced by a formal Written Resolution of the Plan Sponsor. The Adoption
Resolution may contain such specific changes and variations in Plan terms and
provisions applicable to the adopting Participating Employer and its Employees
as may be acceptable to the Plan Sponsor and the Trustee. However, the sole,
exclusive right of any other amendment of whatever kind or extent to the Plan is
reserved to the Plan Sponsor. The Adoption Resolution will become, as to the
adopting organization and its Employees, a part of this Plan as then amended or
thereafter amended. It will not be necessary for the adopting organization to
sign or execute the original or then amended Plan and Trust Agreement or any
future amendment to the Plan and Trust Agreement. The effective date of the Plan
for any adopting organization will be that stated in the Adoption Resolution and
from and after such effective date the adopting organization will assume all the
rights, obligations and liabilities as a Participating Employer under this Plan.
The administrative powers of and control by the Plan Sponsor as provided in the
Plan, including the sole right of amendment or termination of the Plan, of
appointment and removal of the Plan Administrator and the Trustee, and of
appointment and removal of an investment manager will not be diminished by
reason of the participation of the adopting organization in the Plan.

8-2

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(b)

Withdrawal

Any Participating Employer may withdraw from the Plan at any time, without
affecting the Plan Sponsor or other Participating Employers not withdrawing, by
complying with the provisions of the Plan. A withdrawing Participating Employer
may arrange for the continuation by itself or its successor of this Plan in
separate forms for its own employees, with such amendments, if any, as it may
deem proper, and may arrange for continuation of the Plan by merger with an
existing plan and transfer of plan assets. The Plan Sponsor may, at its absolute
discretion, terminate a Participating Employer’s participation at any time when
in its judgment the Participating Employer fails or refuses to discharge its
obligation under the Plan.

(c)

Adoption Contingent Upon Initial and Continued Qualifications

The adoption of this Plan by an organization as provided is hereby made
contingent and subject to the condition precedent that said adopting
organization meets all the statutory requirements for qualified plans,
including, but not limited to, Sections 401(a) and 501(a) of the Internal
Revenue Code for its Employees. If the Plan or the Trust, in its operation,
becomes disqualified, for any reason, as to the adopting organization and its
Employees, the portion of the Plan assets allocable to them will be segregated
as soon as is administratively feasible, pending either the prompt (1)
requalification of the Plan as to the organization and its employees to the
satisfaction of the Internal Revenue Service so as not to affect the continued
qualified status thereof as to other Employers, (2) withdrawal of the
organization from this Plan and a continuation by itself or its successor of its
plan separately from this Plan, or by merger with another existing plan, with a
transfer of its said segregated portion of Plan assets, or (3) termination of
the Plan as to itself and its Employees.

8.08

Employer Contributions

The Employer (and any Participating Employers) will make contributions to the
Plan at its discretion, except that contributions will not be less than the
minimum contribution required by any applicable sections of the Code, including
section 412, and with any other applicable federal statute.

Employer contributions made to the Plan are made and will be held for the sole
purpose of providing benefits to Participants and their Beneficiaries. In no
event will any contribution made by the Employer to the Plan or income there
from revert to the Employer or otherwise be used or diverted to purposes other
than for the exclusive benefit of Participants and their Beneficiaries
(including costs of maintaining and administering the Plan). Notwithstanding the
foregoing, Employer contributions may be refunded to the Employer on written
demand within one year of the event giving rise to the right to refund and upon
presentation to the Trustee of evidence of the right to and amount of the
refund, but only to the extent that the refunds do not, in themselves, deprive
the Plan of its qualified status, under the following circumstances and subject
to the following limitations:

(a)

Any contribution which is made in whole or in part by reason of a mistake of
fact (for example, incorrect information as to the eligibility or compensation
of a Participant, or a mathematical or actuarial error), be returned to the
Employer.

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(b)

Notwithstanding any other provision of the Plan, if the Internal Revenue Service
determines initially that the Plan, as adopted by the Employer, does not qualify
under applicable sections of the Code and applicable Treasury Department
Regulations, and the Employer declines either to amend this Plan so that it
meets the objections of the Internal Revenue Service or to contest the
determination of the Internal Revenue Service in court, the value of all assets
will be distributed by the Trustee to the Employer. Thereafter, the Employer’s
participation in this Plan will be considered rescinded and of no force or
effect.

Any contribution made incident to initial qualification must be returned within
one year after date initial qualification is denied, but only if application for
initial qualification is made by time prescribed by law for filing the Company’s
return for taxable year in which Plan is adopted, or such later date as the
Secretary of the Treasury may prescribe.

(c)

Any contribution made by the Employer will be conditioned on the deductibility
of such contribution and may be refunded to the Employer, to the extent the
contribution is determined not to be deductible, within one year after such
determination is made.

(d)

In the event of termination of the Trust, funds may revert to the Employer as
provided in section 10.02.

8.09

Reserved

8.10

Reserved

8.11

Rollover Contributions

(a)

Rollover Account

Rollover Account means the separate account of a Participant reflecting Rollover
Contributions and/or a direct transfer of assets from another qualified plan if
such assets are to be credited to such separate account; and

Rollover Account will also reflect investment income (loss) allocated thereto
and distributions. A Participant will be 100% vested at all times in his
Rollover Account.

(b)

Rollover Contribution

Rollover Contribution means a contribution to the Plan by a Participant where
such contribution was the result of a prior distribution from an Individual
Retirement Account, an Individual Retirement Annuity or another qualified plan.
Such prior distribution must be a rollover amount described in section 402(a)(5)
of the Code or a rollover contribution described in section 408(d)(3) of the
Code.

Each Employee who is a member of an Eligible Employee Classification, regardless
of whether he is a Participant in the Plan, will have the right to make a
Rollover Contribution of cash (or other property of a form acceptable to the
Plan Administrator and the Trustee) into the Plan from another qualified plan.
If the Employee is not a Participant hereunder, his Rollover Account will
constitute his entire interest in the Plan. In no event will the existence of a
Rollover Account entitle the Employee to participate in any other benefit
provided by the Plan.

(c)

Investment

Each Rollover Account will be credited with a pro-rata share of the Trust Fund
earnings, unless such contributions are segregated and invested separately in
which case such contributions will be credited with a prorata share of the
earnings of the respective segregated funds of which they are a part.

(d)

Accounting

Separate accounting will be maintained for amounts credited to Rollover Accounts
including earnings and/or losses thereon.

8-4

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(e)

Participant Direction of Investment

A Participant will have the right to direct the Trustee with respect to the
investment or reinvestment of the assets comprising the Participant’s Rollover
Account only if the Trustee consents in writing to permit such direction. If the
Trustee does consent to Participant direction of investment, the Trustee and
each Participant will execute a letter agreement containing such conditions,
limitations and other provisions they deem appropriate before the Trustee will
follow any Participant direction. The Trustee will not be liable for any loss,
or by reason of any breach, resulting from a Participant’s direction of the
investment of any part of his Rollover Account. The Trustee will maintain as a
segregated account any portion of the Participant’s Rollover Account to which
this Section applies.

(f)

Distribution of Rollover Account

In the event of a Participant’s termination of employment for any reason, he
will receive a distribution of his Rollover Account as of the date coincident
with the time the Plan otherwise provides for the distribution of benefits to
Participants or their Beneficiaries.

(g)

Form of Payment of Rollover Account

The form of payment of a Participant’s Rollover Account will be governed by the
provisions of section 3.06 if the reason for payment is other than death.

If a Participant dies before his Annuity Starting Date, and if a Beneficiary
other than the Participant’s Surviving Spouse has not been designated pursuant
to a Qualified Election, the Participant’s Surviving Spouse will be entitled to
receive a distribution of the Participant’s Rollover Account payable in the form
of a Qualified Survivor Annuity with payments to commence on the first day of
the month coincident with or next following the Participant’s date of death. The
monthly pension benefit will be a single life annuity which is actuarially
equivalent to the value of the Participant’s Rollover Account.

If a Surviving Spouse does not exist or if a Beneficiary other than the
Participant’s Surviving Spouse has been designated pursuant to a Qualified
Election, the Participant’s designated Beneficiary will be entitled to receive a
death benefit equal to the value of the Participant’s Rollover Account.

If the value of a Participant’s Rollover Account is non-zero, the lump sum
values described in the last paragraphs of Sections 1.44 and 3.06 will include
the values of his Rollover Account.

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ARTICLE 9

ADMINISTRATION

9.01

Plan Administrator

The Plan Administrator will have the responsibility for the general supervision
and administration of the Plan and will be a fiduciary of the Plan. The Employer
may, by Written Resolution, appoint one or more individuals to serve as Plan
Administrator. If the Employer does not appoint an individual or individuals as
Plan Administrator, the Employer will function as Plan Administrator. The
Employer may at any time, with or without cause, remove an individual as Plan
Administrator or substitute another individual therefore.

9.02

Powers and Duties of the Plan Administrator

The Plan Administrator will be charged with and will have delegated to it the
exclusive power, duty, authority and discretion to interpret and construe the
provisions of this Plan, to determine its meaning and intent and to make
application thereof to the facts of any individual case; to determine in its
discretion the rights and benefits of Participants or the eligibility of
Employees; to give necessary instructions and directions to the Trustee and the
Insurer as herein provided or as may be requested by the Trustee and the Insurer
from time to time; and to generally direct the administration of the Plan
according to its terms. All decisions of the Plan Administrator in matters
properly coming before it according to the terms of this Plan, and all actions
taken by the Plan Administrator in the proper exercise of its administrative
powers, duties and responsibilities, will be final and binding upon all
Employees, Participants and Beneficiaries and upon any person having or claiming
any rights or interest in this Plan; will be given deference in all courts of
law, to the greatest extent allowed by applicable law; and, will not be
overturned or set aside by any court of law unless the court finds that the
Trustees, or their designee, abused their discretion in making such
determination or rendering such interpretation. The Employer and the Plan
Administrator will make and receive any reports and information, and retain any
records necessary or appropriate to the administration of this Plan or to the
performance of duties hereunder or to satisfy any requirements imposed by law.
In the performance of its duties, the Plan Administrator will be entitled to
rely on information duly furnished by any Employee, Participant or Beneficiary
or by the Employer or Trustee.

9.03

Actions of the Plan Administrator

The Plan Administrator may adopt such rules as it deems necessary, desirable or
appropriate with respect to the conduct of its affairs and the administration of
the Plan. Whenever any action to be taken in accordance with the terms of the
Plan requires the consent or approval of the Plan Administrator, or whenever an
interpretation is to be made of the terms of the Plan, the Plan Administrator
will act in a uniform and non-discriminatory manner, treating all Employees and
Participants in similar circumstances in a like manner. If the Plan
Administrator is a group of individuals, all of its decisions will be made by a
majority vote. The Plan Administrator will have the authority to employ one or
more persons to render advice or services with regard to the responsibilities of
the Plan Administrator, including but not limited to attorneys, actuaries, and
accountants. Any persons employed to render advice or services will have no
fiduciary responsibility for any ministerial functions performed with respect to
this Plan.

9.04

Reliance on Plan Administrator and Employer

Until the Employer gives notice to the contrary, the Trustee and any persons
employed to render advice or services will be entitled to rely on the
designation of Plan Administrator that has been furnished to them. In addition,
the Trustee and any persons employed to render advice or services will be fully
protected in acting upon the written directions and instructions of the Plan
Administrator made in accordance with the terms of this Plan. If the Plan
Administrator is a group of individuals, unless otherwise specified, any one of
such individuals will be authorized to sign documents on behalf of the Plan
Administrator and such authorized signatures will be recognized by all persons
dealing with the Plan Administrator. The Trustee and any persons employed to
render advice or services may take cognizance of any rules established by the
Plan Administrator and rely upon them until notified to the contrary. The
Trustee and any persons employed to render advice or services will be fully
protected in taking any action upon any paper or document believed to be genuine
and to have been properly signed and presented by the Plan Administrator,
Employer or any agent of the Plan Administrator acting on behalf of the Plan
Administrator.

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9.05

Reports to Participants

The Plan Administrator will report in writing to a Participant his Accrued
Benefit under the Plan and the Vested Percentage of such benefit when the
Participant terminates his employment or requests such a report in writing from
the Plan Administrator. To the extent required by law or regulation, the Plan
Administrator will annually furnish to each Participant, and to each Beneficiary
receiving benefits, a report which fairly summarizes the Plan’s most recent
report.

9.06

Bond

The Plan Administrator and other fiduciaries of the Plan will be bonded to the
extent required by ERISA or other applicable law. No additional bond or other
security for the faithful performance of any duties under this Plan will be
required.

9.07

Compensation of Plan Administrator

The Compensation of the Plan Administrator will be left to the discretion of the
Plan Sponsor; no person who is receiving full pay from the Employer will receive
compensation for services as Plan Administrator. All reasonable and necessary
expenses incurred by the Plan Administrator in supervising and administering the
Plan will be paid from the Plan Assets by the Trustee at the direction of the
Plan Administrator to the extent not paid by the Plan Sponsor.

9.08

Claims Procedure

The Plan Administrator will make all determinations as to the rights of any
Employee, Participant, Beneficiary or other person under the terms of this Plan.
Any Employee, Participant or Beneficiary, or person claiming under them, may
make claim for benefit under this Plan by filing written notice with the Plan
Administrator setting forth the substance of the claim. If a claim is wholly or
partially denied, the claimant will have the opportunity to appeal the denial
upon filing with the Plan Administrator a written request for review within 60
days after receipt of notice of denial. In making an appeal the claimant may
examine pertinent Plan documents and may submit issues and comments in writing.
Denial of a claim or a decision on review will be made in writing by the Plan
Administrator delivered to the claimant within 60 days after receipt of the
claim or request for review, unless special circumstances require an extension
of time for processing the claim or review, in which event the Plan
Administrator’s decision must be made as soon as possible thereafter but not
beyond an additional 60 days. If no action on an initial claim is taken within
120 days, the claims will be deemed denied for purposes of permitting the
claimant to proceed to the review stage. The denial of a claim or the decision
on review will specify the reasons for the denial or decision and will make
reference to the pertinent Plan provisions upon which the denial or decision is
based. The denial of a claim will also include a description of any additional
material or information necessary for the claimant to perfect the claim and an
explanation of the claim review procedure herein described. The Plan
Administrator will serve as an agent for service of legal process with respect
to the Plan unless the Employer, through written resolution, appoints another
agent.

If a Participant or Beneficiary is entitled to a distribution from the Plan, the
Participant or Beneficiary will be responsible for providing the Plan
Administrator with his current address. If the Plan Administrator notifies the
Participant or Beneficiary by registered mail (return receipt requested) at his
last known address that he is entitled to a distribution and also notifies him
of the provisions of this paragraph, and the Participant or Beneficiary fails to
claim his benefits under the Plan or provide his current address to the Plan
Administrator within one year after such notification, the distributable amount
will be forfeited and used to reduce the cost of the Plan. If the Participant or
Beneficiary is subsequently located, such benefit will be restored. If this Plan
is terminated in accordance with Section 10.01, then any unrestored benefits
which were previously forfeited in accordance with this paragraph will be
restored prior to the application of Section 10.02.

9.09

Liability of Fiduciaries

Except for a breach of fiduciary responsibility due to gross negligence or
willful misconduct, the Plan Administrator will not incur any individual
liability for any decision, act, or failure to act hereunder. The Plan
Administrator may engage agents to assist it and may engage legal counsel who
may be counsel for the Employer. The Plan Administrator will not be responsible
for any action taken or omitted to be taken on the advice of counsel.

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If there is more than one person serving as a fiduciary in any capacity (for
example, co-Trustees), each will use reasonable care to prevent the other or
others from committing a breach of this Plan. Nothing contained in this Section
will preclude any agreement allocating specific responsibilities or obligations
among the co-fiduciaries provided that the agreement does not violate any of the
terms and provisions of this Plan. In those instances where any duties have been
allocated between co-fiduciaries, a fiduciary will not be liable for any loss
resulting to the Plan arising from any act or omission on the part of another
co-fiduciary to whom responsibilities or obligations have been allocated except
under the following circumstances:

(a)

If he participates knowingly in, or knowingly undertakes to conceal, an act or
omission of a co-fiduciary knowing the act or omission is a breach; or

(b)

If by his failure to comply with his specific responsibilities which give rise
to his status as a fiduciary, he has enabled the other fiduciary to commit a
breach; or

(c)

If he has a knowledge of a breach by a co-fiduciary, unless he makes reasonable
efforts under the circumstances to remedy the breach.

9.10

Expenses of Administration

The Employer does not and will not guarantee the Plan Assets against loss. The
Employer may in its sole discretion, but will not be obligated to, pay the
ordinary expenses of establishing the Plan, including the fees of consultants,
accountants and attorneys in connection therewith. The Employer may, in its sole
discretion (but will not be obligated to), pay other costs and expenses of
administering the Plan, the taxes imposed upon the Plan, if any, and the fees,
charges or commissions with respect to the purchase and sale of Plan Assets.
Unless paid by the Employer, such costs and expenses, taxes (if any), and fees,
charges and commissions will be a charge upon Plan Assets and deducted by the
Trustee.

9.11

Distribution Authority

If any person entitled to receive payment under this Plan is a minor, declared
incompetent or is under other legal disability, the Plan Administrator may, in
its sole discretion, direct the Trustee to:

(a)

Distribute directly to the person entitled to the payment; or

(b)

Distribute to the legal guardian or, if none, to a parent of the person entitled
to payment or to a responsible adult with whom the person entitled to payment
maintains his residence; or

(c)

Distribute to a custodian for the person entitled to payment under the Uniform
Gifts to Minors Act if permitted by the laws of the state in which the person
entitled to payment resides; or

(d)

Withhold distribution of the amount payable until a court of competent
jurisdiction determines the rights of the parties thereto or appoints a guardian
of the estate of the person entitled to payment.

If there is any dispute, controversy or disagreement between any Beneficiary or
person and any other person as to who is entitled to receive the benefits
payable under this Plan, or if the Plan Administrator is uncertain as to who is
entitled to receive benefits, or if the Plan Administrator is unable to locate
the person who is entitled to benefits, the Plan Administrator may with
acquittance interplead the funds into a court of competent jurisdiction in the
judicial district in which the Employer maintains its principal place of
business and, upon depositing the funds with the clerk of the court, be released
from any further responsibility for the payment of the benefits. If it is
necessary for the Plan Administrator to retain legal counsel or incur any
expense in determining who is entitled to receive the benefits, whether or not
it is necessary to institute court action, the Plan Administrator will be
entitled to reimbursement from the benefits for the amount of its reasonable
costs, expenses and attorneys’ fees incurred.

9.12

Funding Policy

The Employer will establish a funding policy upon which contributions will be
based bearing in mind both the short-run and long-run needs and goals of the
Plan. The Plan Administrator will periodically review the funding policy for its
appropriateness under the circumstances then prevailing and recommend to the
Employer any changes in the funding policy which the Plan Administrator
considers appropriate. As an aid to the Plan Administrator in reviewing the
funding policy, the Actuary appointed by the Plan Administrator will make
periodic actuarial valuations of the assets and liabilities of the Plan and will
advise the Plan Administrator of the results of the valuations.

9-3

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ARTICLE 10

AMENDMENT OR TERMINATION OF PLAN

10.01

Right of Plan Sponsor to Amend or Terminate

(a)

Right to alter, amend, revoke or terminate

The Plan Sponsor reserves the right to alter, amend, revoke or terminate this
Plan by action of the Board of Directors. No amendment will deprive any
Participant or Beneficiary of any vested right nor will it reduce the present
value (determined upon an Actuarial Equivalent basis) of any Accrued Benefit to
which he is then entitled with respect to Employer contributions previously
made, except as may be required to maintain the Plan as a qualified plan under
the Code. No amendment will change the duties or responsibilities of the Trustee
without its express written consent thereto.

(b)

Effect on early retirement benefits

A plan amendment which has the effect of (i) eliminating or reducing an early
retirement benefit or a retirement-type subsidy, or (ii) eliminating an optional
benefit form, will, with respect to benefits attributable to service before the
amendment be treated as reducing Accrued Benefits. In the case of a
retirement-type subsidy, the preceding sentence will apply only with respect to
a Participant who satisfies (either before or after the amendment) the
preamendment conditions for the subsidy. In general, a retirement-type subsidy
is a subsidy that continues after retirement but does not include a disability
retirement benefit, a medical benefit, a Social Security supplement, a
pre-retirement death benefit, or a plant shutdown benefit (that does not
continue after retirement).

(c)

Minimum Accrued Benefit

A minimum Accrued Benefit value will apply if this Plan is or becomes a
successor to a profit sharing plan, a defined contribution pension plan, a
target benefit plan, or a defined benefit pension plan which was fully insured,
or any plan under which the accrued benefit of a Participant was determined as a
lump sum or account balance. The Actuarial Equivalent value of a Participant’s
Accrued Benefit will not be less than the Actuarial Equivalent value of his
Accrued Benefit on the Effective Date of the Plan.

10.02

Allocation of Assets Upon Termination of Plan

If this Plan is revoked or terminated (in whole or in part), the rights of each
Participant with respect to benefits accrued to the date of revocation,
termination or partial termination will become nonforfeitable (to the extend
funded).

The Employer will comply with any legal requirements to notify the Internal
Revenue Service (IRS) and, if this Plan is covered by Plan Termination Insurance
under Federal law, the Pension Benefit Guaranty Corporation (PBGC).

The Employer will then arrange for allocation of all assets among Participants
in accordance with an actuarial valuation meeting the requirements of all
applicable laws and the regulations and requirements of the IRS and the PBGC.
Allocation of assets among Participants will be in the following order of
priority:

(a)

First, to any Deductible Voluntary Account, Nondeductible Voluntary Account or
Rollover Account;

(b)

Second, to that portion, if any, of each Participant’s accrued benefit which is
derived from the Participant’s mandatory contributions;

(c)

Third, to retirement benefits which were in pay status or were available to a
Participant 3 years before the date of severance of the Plan based on Plan
provisions in effect 5 years before the date of severance;

(d)

Fourth, to all other benefits guaranteed by the PBGC (determined without regard
to section 4022(b)(5) of ERISA and as if section 4022(b)(6) of ERISA did not
apply);

10-1

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(e)

Fifth, to all other vested benefits; and

(f)

Sixth, to all other benefits.

If Plan assets are not sufficient to provide the total amount required in any
classification, the allocation will be proportionately reduced for all
Participants for benefits in such classification. Any part of a vested benefit
not guaranteed by the PBGC will take precedence after all benefits which are
guaranteed. The allocation procedure and methods used will be subject to
requirements of law and to any modification required by either the PBGC or the
IRS.

If upon termination of the Trust, all liabilities of the Plan to Participants
and other persons have been satisfied and all expenses of terminating the Plan
and distributing the Plan Assets have been paid, any excess assets arising from
erroneous actuarial computation will revert to the Participating Employer.

The rights of the Participants or, in the case of a partial termination, the
rights of the Participants affected by the partial termination will be
nonforfeitable as to benefits accrued to the date of severance, to the extent
funded. All allocated amounts will be retained in the Plan to the credit of the
individual Participants until distribution as directed by the Employer.
Distribution to Participants may be in the form of cash, other Plan Assets,
nontransferable annuity contracts, or partly in each.

In the event of the termination of the Plan, the benefit of any Highly
Compensated Employee (and any Highly Compensated Former Employee) will be
limited to a benefit which is nondiscriminatory in accordance with the
provisions of section 401(a)(4) of the Code.

10.03

Exclusive Benefit

At no time will any part of the principal or income of the Plan Assets be used
or diverted for purposes other than the exclusive benefit of Participants in the
Plan and their Beneficiaries, nor may any portion of the Plan Assets revert to
the Employer except as provided in sections 8.08 and 10.02.

10.04

Failure to Qualify

Notwithstanding any of the foregoing provisions, if this Plan, upon adoption by
the Employer, is submitted to the Internal Revenue Service which then determines
that the Plan as initially adopted by the Employer is not a qualified plan under
the Code, the Employer may elect to terminate this Plan by giving written notice
thereof. Such termination will have the same effect as if the Plan were never
adopted, all policies and contracts will be canceled, and all contributions, to
the extent recoverable from the Trustee, will be returned to their source. If
any amendment to this Plan is submitted to the Internal Revenue Service within
the period allowed under section 401(b) of the Code which then determines that
the Plan as amended is not a qualified plan under the Code, the Employer may
cancel or modify any or all provisions of the amendment retroactive to the
effective date of the amendment in order to maintain the qualified status of the
Plan, whereupon written notice thereof will be furnished to all affected
Employees, Participants and Beneficiaries.

10.05

Mergers, Consolidations or Transfers of Plan Assets

In the event this Plan is merged or consolidated with another plan which is
qualified under Code sections 401(a) (and 501(a) if applicable) of the Code, or
in the event of a transfer of the assets or liabilities of this Plan to another
plan which is qualified under sections 401(a) (and 501(a) if applicable) of the
Code, the benefit which each Participant would be entitled to receive under the
successor plan or other plan if it were terminated immediately after the merger,
consolidation or transfer will be equal to or greater than the benefit which the
Participant would have received immediately before the merger, consolidation or
transfer if this Plan had then terminated.

Any transfer of assets and/or liabilities to (or from) this Plan from (or to)
another plan qualified under sections 401(a) (and 501(a) if applicable) of the
Code will be evidenced by a Written Resolution by the plan sponsor of each
affected plan which specifically authorizes such transfer of assets and/or
liabilities.

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10.06

Effect of Plan Amendment on Vesting Schedule

No amendment to the Vesting Schedule will deprive a Participant of his
nonforfeitable right to his Vested Accrued Benefit as of the date of the
amendment. Further, if the Vesting Schedule of the Plan is amended, or if the
Plan is amended in any way that directly or indirectly affects the computation
of a Participant’s non-forfeitable percentage, each Participant with at least 3
Years of Vesting Service as of the last day of the election period described
below may elect, within a reasonable period after the adoption of the amendment,
to have his Vested Percentage computed under the Plan without regard to such
amendment. The period during which such election may be made will commence with
the date the amendment is adopted and will end 60 days after the latest of:

(a)

The date the amendment is adopted; or

(b)

The date the amendment becomes effective; or

(c)

The date the Participant is issued written notice of the amendment by the
Employer.

10.07

Early Termination of Plan

The provisions of this section will apply only with respect to Participants who
are Highly Compensated Employees and Highly Compensated Former Employees (herein
called Restricted Participants). In any one year, the total number of Restricted
Participants is limited to a total of the 25 Highly Compensated Employees and
Highly Compensated Former Employees of the Participating Employer with the
greatest Compensation in the current or any prior Plan Year.

The annual benefit to which a Restricted Participant will be entitled is limited
to:

(a)

A straight life annuity which is the actuarial equivalent of the Participant’s
Accrued Benefit and other benefits to which the Participant is entitled under
the provisions of the Plan (other than a Social Security supplement); plus

(b)

The amount of payments the Participant is entitled to receive under a Social
Security supplement.

Notwithstanding the foregoing, the restrictions of this section do not apply if
any one of the following requirements is satisfied:

(a)

After the payment to a Restricted Participant of all benefits payable under the
Plan, the market value of Plan Assets is not less than 110% of the value of
current liabilities as defined in section 412(l)(7) of the Code; or

(b)

The value of benefits payable to a Restricted Participant is less than 1% of the
current liabilities before such distribution; or

(c)

The value of benefits payable to a Restricted Participant does not exceed the
amount described in section 411(a)(11)(A) of the Code concerning restrictions on
certain mandatory distributions.

For purposes of the above calculations, the market value of Plan Assets and the
value of current liabilities are to be determined in a manner which is
consistent with Treasury Regulation 1.401(a)(4)-5(b).

10.08

Action by Employer

Any action by the Employer under this Plan may be by resolution of its Board of
Directors, or by any person or persons duly authorized by resolution of said
Board to take such action.

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ARTICLE 11

Trustee and Trust Fund

11.01

Acceptance of Trust

The Trustee, by signing this Agreement, accepts this Trust and agrees to perform
the duties of the Trustee in accordance with the terms and conditions set forth
herein.

11.02

Trust Fund

(a)

Purpose and Nature

The Trustee will establish and maintain a Trust Fund for purposes of providing a
means of accumulating the assets necessary to provide the benefits which become
payable under the Plan. The Trustee will receive, hold and invest all
contributions made by the Employer, any Participating Employers, and the
Participants, including the investment earnings thereon. The Trust Fund arising
from such contributions and earnings will consist of all assets held by the
Trustee under the Plan and Trust. All benefits payable under the Plan will be
paid by the Trustee from the Trust Fund.

Any person having any claim under the Plan will look solely to the assets of the
Trust Fund for satisfaction. In no event will the Plan Administrator, the
Employer, any Employees, any officer of the Employer or any agents of the
Employer or the Plan Administrator be liable in their individual capacities to
any person whomsoever, under the provisions of this Plan and Trust, except as
provided by law.

The Trust Fund will be used and applied only in accordance with the provisions
of the Plan and Trust, to provide the benefits thereof, and no part of the
corpus or income of the Trust Fund will be used for, or diverted to, purposes
other than for the exclusive benefit of the Participants or their Beneficiaries
entitled to benefits under the Plan, except to the extent specifically provided
elsewhere herein.

(b)

Investments

The Trustee will invest the Trust Fund in accordance with the investment policy
for the Trust Fund considering the fiduciary requirements of law, the objectives
of the Plan, and the liquidity needs of the Plan.

(c)

Investment Policy

The Plan Sponsor (or the Plan Administrator or an Investment Committee appointed
by the Plan Sponsor) will have the right to periodically provide the Trustee
with a written investment policy which, in consideration of the needs of the
Plan, sets forth the investment objectives, policies, and guidelines which the
Plan Sponsor judges to be appropriate and prudent.

If a written investment policy is not so provided, then the Trustee will set
forth the investment policy for the Plan. In doing so, the Trustee may consult
with the Plan Sponsor (or the Plan Administrator or an Investment Committee
appointed by the Plan Sponsor) to secure information with regard to Plan Sponsor
investment objectives and general investment policy.

(d)

Operation of Trust Fund

The Trust Fund will be maintained in accordance with the accounting requirements
of the Plan. No Participant will have any right to any specific asset or any
specific portion of the Trust Fund prior to distribution of benefits.
Withdrawals from the Trust Fund will be made to provide benefits to Participants
and Beneficiaries in the amounts specified by the Plan, and to pay expenses
authorized by the Plan Administrator.

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(e)

Plan Sponsor Direction of Investment

The Plan Sponsor will have the right to direct the Trustee with respect to the
investment and reinvestment of assets comprising the Trust Fund. The Trustee and
the Plan Sponsor (or the Plan Administrator or an Investment Committee appointed
by the Plan Sponsor) will execute a letter of agreement as a part of this Plan
containing such conditions, limitations and other provisions they deem
appropriate before the Trustee will follow any Plan Sponsor direction with
respect to the investment or reinvestment of any part of the Trust Fund.

11.03

Receipt of Contributions

The Trustee will be accountable to the Employer for the funds contributed to it,
but will have no duty to see that the contributions received comply with the
provisions of the Plan. The Trustee will not be obligated to collect any
contributions from the Employer or the Participants.

11.04

Powers of the Trustee

Subject to the provisions and limitations contained elsewhere in this Plan, the
Trustee will have full discretion and authority with regard to the investment of
the Trust Fund. The Trustee is authorized and empowered, but not by way of
limitation, with the following powers, rights and duties:

(a)

To invest any part or all of the Trust Fund in any common or preferred stocks,
open-end or closed-end mutual funds, United States retirement plan bonds,
corporate bonds, debentures, convertible debentures, commercial paper, U.S.
Treasury bills, book entry deposits with the United States Federal Reserve Bank
or System, Master Notes or similar arrangements sponsored by the Trustee or any
other financial institution as permitted by law, improved or unimproved real
estate situated in the United States, mortgages, notes or other property of any
kind, real or personal, as a prudent man would so invest under like
circumstances with due regard for the purposes of this Plan. Any investment made
or retained by the Trustee in good faith will be proper but must be of a kind
constituting a diversification considered by law suitable for trust investments;

(b)

To maintain any part of the assets of the Trust Fund in cash, or in demand or
short-term time deposits bearing a reasonable rate of interest (including demand
or short-term time deposits of or with the Trustee), or in a short-term
investment fund or in other cash equivalents having ready marketability,
including, but not limited to, U.S. Treasury Bills, commercial paper,
certificates of deposit (including such certificates of deposit of or with the
Trustee), and similar types of short-term securities, as may be deemed necessary
by the Trustee in its sole discretion;

(c)

To manage, sell, contract to sell, grant options to purchase, convey, exchange,
transfer, abandon, improve, repair, insure, lease for any term even though
commencing in the future or extending beyond the term of the Trust, and
otherwise deal with all property, real or personal, in such manner, for such
considerations and on such terms and conditions as the Trustee will decide;

(d)

To credit and distribute the Trust as directed by the Plan Administrator or any
agent of the Plan Administrator. The Trustee will not be obliged to inquire as
to whether any payee or distributee is entitled to any payment or whether the
distribution is proper or within the terms of the Plan, or as to the manner of
making any payment or distribution. The Trustee will be accountable only to the
Plan Administrator for any payment or distribution made by it in good faith on
the order or direction of the Plan Administrator or any agent of the Plan
Administrator;

(e)

To borrow money, assume indebtedness, extend mortgages and encumber by mortgage
or pledge;

(f)

To compromise, contest, arbitrate, or abandon claims and demands, in its
discretion;

(g)

To have with respect to the Trust all of the rights of an individual owner,
including the power to give proxies, to participate in any voting trusts,
mergers, consolidations or liquidations, and to exercise or sell stock
subscriptions or conversion rights;

(h)

To hold any securities or other property in the name of the Trustee or its
nominee, or in another form as it may deem best, with or without disclosing the
trust relationship;

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(i)

To perform any and all other acts in its judgment necessary or appropriate for
the proper and advantageous management, investment and distribution of the
Trust;

(j)

To retain any funds or property subject to any dispute without liability for the
payment of interest, and to decline to make payment or delivery of the funds or
property until final adjudication is made by a court of competent jurisdiction;

(k)

To file all tax forms or returns required of the Trustee;

(l)

To begin, maintain or defend any litigation necessary in connection with the
administration of the Plan, except that the Trustee will not be obligated to or
required to do so unless indemnified to its satisfaction; and

(m)

To keep any or all of the Trust property at any place or places within the
United States or abroad, or with a depository or custodian at such place or
places; provided, however, that the Trustee may not maintain the indicia of
ownership of any assets of the Plan outside the jurisdiction of the District
Courts of the United States, except as may be expressly authorized in U.S.
Treasury or U.S. Department of Labor regulations.

11.05

Investment in Common or Collective Trust Funds

Notwithstanding the provisions of section 11.04, the Plan Sponsor specifically
authorizes the Trustee to invest all or any portion of the assets comprising the
Trust Fund in any common or collective trust fund which at the time of the
investment provides for the pooling of the assets of plans qualified under
section 401(a) of the Code. The authorization applies only if such common or
collective trust fund: (a) is exempt from taxation under section 584 or 501(a)
of the Code; (b) if exempt under section 501(a) of the Code, expressly limits
participation to pension and profit sharing trusts which are exempt under
section 501(a) of the Code by reason of qualifying under section 401(a) of the
Code; (c) prohibits that part of its corpus or income which equitably belongs to
any participating trust from being used for or diverted to any purposes other
than for the exclusive benefit of the Employees or their Beneficiaries who are
entitled to benefits under such participating trust; (d) prohibits assignment by
participating trust of any part of its equity or interest in the group trust;
and (e) the sponsor of the group trust created or organized the group trust in
the United States and maintains the group trust at all times as a domestic trust
in the United States. The provisions of the common or collective trust fund
agreement, as amended by the Trustee from time to time, are by this reference
incorporated within this Plan and Trust. The provisions of the common or
collective trust fund will govern any investment of Plan Assets in that fund.
This provision constitutes the express permission required by section 408(b)(8)
of ERISA.

11.06

Investment in Insurance Company Contracts

The Trustee may invest any portion of the Trust Fund in a deposit
administration, guaranteed investment or similar type of investment contract
(hereinafter referred to as Contract); provided, however, that no such Contract
may provide for an optional form of benefit which would not be provided for
under the provisions hereof. The Trustee will be the complete and absolute owner
of Contracts held in the Trust Fund.

The Trustee may convert from one form to another any Contract held in the Trust
Fund; designate any mode of settlement; sell or assign any Contract held in the
Trust Fund; surrender for cash any Contract held in the Trust Fund; agree with
the insurance company issuing any Contract to any release, reduction,
modification or amendment thereof; and, without limitation of any of the
foregoing, exercise any and all of the rights, options and privileges that
belong to the absolute owner of any Contract held in the Trust Fund that are
granted by the terms of any such Contract or by the terms of this Agreement.

The Trustee will hold in the Trust Fund the proceeds of any sale, assignment or
surrender of any Contract held in the Trust Fund and any and all dividends and
other payments of any kind received in respect to any Contract held in the Trust
Fund.

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No insurance company which may issue any Contract based upon the application of
the Trustee will be responsible for the validity of this Plan, be required to
look into the terms of this Plan, be required to question any act of the Plan
Administrator or the Trustee hereunder or be required to verify that any action
of the Trustee is authorized by this Plan. If a conflict should arise between
the terms of the Plan and any such Contract, the terms of the Plan will govern.

11.07

Fees and Expenses from Fund

The Trustee will be entitled to receive reasonable annual compensation as may be
mutually agreed upon from time to time between the Plan Sponsor and the Trustee.
The Trustee will pay all expenses reasonably incurred by it in its
administration and investment of the Trust Fund from the Trust Fund unless the
Plan Sponsor pays the expenses. No person who is receiving full pay from the
Plan Sponsor will receive compensation for services as Trustee.

11.08

Records and Accounting

The Trustee will keep full and complete records of the administration of the
Trust Fund which the Employer and the Plan Administrator may examine at any
reasonable time. As soon as practical after the end of each Plan Year and at
such other reasonable times as the Employer may direct, the Trustee will prepare
and deliver to the Employer and the Plan Administrator an accounting of the
administration of the Trust, including a report on the valuation of all assets
of the Trust Fund, such valuation to be based upon the fair market value on the
valuation date.

11.09

Distribution Directions

If no one claims a payment or distribution made from the Trust, the Trustee will
notify the Plan Administrator and will dispose of the payment in accordance with
the subsequent direction of the Plan Administrator.

11.10

Third Party

No person dealing with the Trustee will be obligated to see to the proper
application of any money paid or property delivered to the Trustee, or to
inquire whether the Trustee has acted pursuant to any of the terms of the Plan.
Each person dealing with the Trustee may act upon any notice, request or
representation in writing by the Trustee, or by the Trustee’s duly authorized
agent, and will not be liable to any person whomsoever in so doing. The
certification of the Trustee that it is acting in accordance with the Plan will
be conclusive in favor of any person relying on the certification.

11.11

Professional Agents

The Trustee may employ and pay from the Trust Fund reasonable compensation to
agents, attorneys, accountants and other persons to advise the Trustee as in its
opinion may be necessary. The Trustee may delegate to any agent, attorney,
accountant or other person selected by it any non-Trustee power or duty vested
in it by the Plan; the Trustee may act or refrain from acting on the advice or
opinion of any agent, attorney, accountant or other person so selected.

11.12

Valuation of Trust

The Trustee will value the Trust Fund as of the last day of each Plan Year to
determine the fair market value of the Trust, and the Trustee will value the
Trust Fund on such other date(s) as may be necessary to carry out the provisions
of the Plan.

11.13

Liability of Trustee

The Trustee will be liable only for the safeguarding and administration of the
assets of this Trust Fund in accordance with the provisions hereof and any
amendments hereto and no other duties or responsibilities will be implied. The
Trustee will not be required to pay any interest on funds paid to or deposited
with it or to its credit under the provisions of this Trust, unless pursuant to
a written agreement between the Employer and the Trustee. The Trustee will not
be responsible for the adequacy of the Trust Fund to meet and discharge any
liabilities under the Plan and will not be required to make any payment of any
nature except from funds actually received as Trustee. The Trustee may consult
with legal counsel (who may be legal counsel for the Employer) selected by the
Trustee and will be fully protected for any action taken, suffered or omitted in
good faith in accordance with the opinion of said legal counsel. It will not be
the duty of the Trustee to determine the identity or mailing address of any
Participant or any other person entitled to benefits hereunder, such identity
and mailing addresses to be furnished by the Employer, the Plan Administrator or
an agent of the Plan Administrator. The Trustee will be under no liability in
making payments in accordance with the terms of this Plan and the certification
of the Plan Administrator or an agent of the Plan Administrator who has been
granted such powers by the Plan Administrator.

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Except to the extent required by any applicable law, no bond or other security
for the faithful performance of duty hereunder will be required of the Trustee.

11.14

Removal or Resignation and Successor Trustee

A Trustee may resign at any time upon giving 30 days prior written notice to the
Plan Sponsor or, with the consent of the Plan Sponsor, a Trustee may resign with
less than 30 days prior written notice.

The Plan Sponsor may remove a Trustee by giving at least 30 days prior written
notice to the Trustee.

Upon the removal or resignation of a Trustee, the Plan Sponsor will appoint and
designate a successor Trustee which will be one or more individual successor
Trustees or a corporate Trustee organized under the laws of the United Sates or
of any state thereof with authority to accept and execute trusts. Any successor
Trustee must accept and acknowledge in writing its appointment as a successor
Trustee before it can act in such capacity.

Title to all property and records or true copies of such records necessary to
the current operation of the Trust Fund held by the Trustee hereunder will vest
in any successor Trustee acting pursuant to the provisions hereof, without the
execution or filing of any further instrument. Any resigning or removed Trustee
will execute all instruments and do all acts necessary to vest such title in any
successor Trustee of record. Each successor Trustee will have, exercise and
enjoy all the powers, both discretionary and ministerial, herein conferred upon
his predecessor. No successor Trustee will be obligated to examine the accounts,
records and acts of any previous Trustee or Trustees, and each successor Trustee
in no way or manner will be responsible for any action or omission to act on the
part of any previous Trustee.

Any corporation which results from any merger, consolidation or purchase to
which the Trustee may be a party, or which succeeds to the trust business of the
Trustee, or to which substantially all the trust assets of the Trustee may be
transferred, will be the successor to the Trustee hereunder without any further
act or formality with like effect as if the successor Trustee had originally
been named Trustee herein; and in any such event it will not be necessary for
the Trustee or any successor Trustee to give notice thereof to any person, and
any requirement, statutory or otherwise, that notice will be given is hereby
waived.

11.15

Appointment of Investment Manager

One or more Investment Managers may be appointed by the Plan Sponsor (or the
Plan Administrator) to exercise full investment management authority with
respect to all or a portion of the Trust assets. Authorized payment of the fees
and expenses of the Investment Manager(s) may be made from the Trust assets. For
purposes of this agreement, any Investment Manager so appointed will, during the
period of his appointment, possess fully and absolutely those powers, rights and
duties of the Trustee (to the extent delegated by the Plan Sponsor or the Plan
Administrator) with respect to the investment or reinvestment of that portion of
the Trust assets over which the Investment Manager has investment management
authority. The Investment Manager must be one of the following:

(a)

Registered as an investment advisor under the Investment Advisors Act of 1940;
or

(b)

A bank, as defined in the Investment Advisors Act of 1940; or

(c)

An insurance company qualified to manage, acquire, or dispose of such Plan
assets under the laws of more than one state.

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Any Investment Manager will acknowledge in writing to the Plan Sponsor or the
Plan Administrator and to the Trustee that he or it is a fiduciary with respect
to the Plan. During any period of time when the Investment Manager is so
appointed and serving, and with respect to those assets in the Plan over which
the Investment Manager exercises investment management authority, the Trustee’s
responsibility will be limited to holding such assets as a custodian, providing
accounting services, disbursing benefits as authorized, and executing such
investment instructions only as directed by the Investment Manager. The Trustee
will not be responsible for any acts or omissions of the Investment Manager. Any
certificates or other instruments duly signed by the Investment Manager (or the
authorized representative of the Investment Manager), purporting to evidence any
instruction, direction or order of the Investment Manager with respect to the
investment of those assets of the Plan over which the Investment Manager has
investment management authority, will be accepted by the Trustee as conclusive
proof thereof. The Trustee will also be fully protected in acting in good faith
upon any notice, instruction, direction, order, certificate, opinion, letter,
telegram or other document believed by the Trustee to be genuine and from the
Investment Manager (or the authorized representative of the Investment Manager).
The Trustee will not be liable for any action taken or omitted by the Investment
Manager or for any mistakes of judgment or other action made, taken or omitted
by the Trustee in good faith upon direction of the Investment Manager.

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IN WITNESS WHEREOF, this instrument has been executed by the duly authorized and
empowered officers of the Participant Employer, this ________ day of
_____________________, _________.

 

 

 

 

Hudson River Bank and Trust Company

 

 

By: 

 

 

 

 

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(Signature)

 

 

 

 

 

 

 

 

Name: 

 

 

 

 

 

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(Print)

 

 

 

 

 

 

 

 

Title: 

 

 

 

 

 

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By: 

 

 

 

 

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(Signature)

 

 

 

 

 

 

 

 

Name: 

 

 

 

 

 

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(Print)

 

 

 

 

 

 

 

 

Title: 

 

 

 

 

 

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The Trustee agrees to continue to serve as Trustee under the terms of this
instrument.

 

 

 

By: 

 

 

 

 

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(Signature)

 

 

 

 

 

 

 

 

Name: 

 

 

 

 

 

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(Print)

 

 

 

 

 

 

 

 

Title: 

 

 

 

 

 

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