EXHIBIT 10 (iii) 25


                              CH ENERGY GROUP, INC.

                            DIRECTORS AND EXECUTIVES

                           DEFERRED COMPENSATION PLAN



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                                TABLE OF CONTENTS
                                -----------------

ARTICLE I         TITLE AND DEFINITIONS.....................................4

      1.1   Title...........................................................4

      1.2   Definitions.....................................................4

ARTICLE II        PARTICIPATION.............................................6

ARTICLE III       DEFERRAL ELECTIONS........................................6

      3.1   Elections to Defer Compensation.................................6

      3.2   Investment Elections............................................7

ARTICLE IV        DEFERRAL ACCOUNTS AND TRUST FUNDING.......................8

      4.1   Deferral Accounts...............................................8

      4.2   Company Discretionary Contribution Account......................8

      4.3   Trust Funding...................................................9

ARTICLE V         VESTING...................................................9

ARTICLE VI        DISTRIBUTIONS............................................10

      6.1   Distribution of Deferred Compensation and Discretionary
            Company Contributions..........................................10

      6.2   Non-Scheduled In-Service Withdrawals...........................11

      6.3   Hardship Distribution..........................................12

      6.4   Inability to Locate Participant................................12

ARTICLE VII       ADMINISTRATION...........................................12

      7.1   Committee......................................................12

      7.2   Committee Action...............................................12

      7.3   Powers and Duties of the Committee.............................13

      7.4   Construction and Interpretation................................13

      7.5   Information....................................................13

                                       (i)

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      7.6   Compensation, Expenses and Indemnity...........................14

      7.7   Monthly Statements.............................................14

      7.8   Disputes.......................................................14

ARTICLE VIII      MISCELLANEOUS............................................15

      8.1   Unsecured General Creditor.....................................15

      8.2   Restriction Against Assignment.................................15

      8.3   Withholding....................................................16

      8.4   Amendment, Modification, Suspension or Termination.............16

      8.5   Governing Law..................................................16

      8.6   Receipt or Release.............................................16

      8.7   Payments on Behalf of Persons Under Incapacity.................16

      8.8   Limitation of Rights and Employment Relationship...............17

      8.9   Headings.......................................................17



                                       (ii)


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                              CH ENERGY GROUP, INC.
                            DIRECTORS AND EXECUTIVES
                           DEFERRED COMPENSATION PLAN

      WHEREAS,  CH Energy Group,  Inc. (the "Company")  desires to provide a tax
deferred capital accumulation  opportunity for members of the Company's Board of
Directors and for a select group of  executives  and key  management  and highly
compensated employees effective as of January 1, 2000; and

      WHEREAS,  Central Hudson Gas & Electric Corporation has previously adopted
the Central Hudson Gas & Electric Corporation  Directors' Deferred  Compensation
Plan, which Plan has been assigned to and assumed by the Company; and

      WHEREAS, Company desires to merge the Central Hudson Gas & Electric
Corporation Directors' Deferred Compensation Plan into this Plan with the
adoption of this Plan,

      NOW,  THEREFORE,  effective  as of  January  1,  2000,  the Plan is hereby
adopted to read as follows  and the  Central  Hudson Gas & Electric  Corporation
Directors'  Deferred  Compensation  Plan is  hereby  merged  into  this  Plan as
described below:

                                   ARTICLE I
                              TITLE AND DEFINITIONS

     1.1 Title.

      This Plan shall be known as the CH Energy Group, Inc. Directors and
Executives Deferred Compensation Plan.

     1.2 Definitions.

      Whenever the following  words and phrases are used in this Plan,  with the
first letter  capitalized,  they shall have the meanings  specified  below.

     (a) "Account" or "Accounts"  shall mean a  Participant's  Deferral  Account
and/or the Company Discretionary Contribution Account.

     (b) "Base Salary" shall mean a Participant's annual base salary,  excluding
bonus, incentive and all other remuneration for services rendered to the Company
and  prior to  reduction  for any  salary  contributions  to a plan  established
pursuant to Section 125 of the Code or qualified  pursuant to Section  401(k) of
the Code.

     (c)  "Beneficiary"  or  "Beneficiaries"  shall mean the person or  persons,
including a trustee, personal representative or other fiduciary, last designated
in writing by a Participant  in accordance  with  procedures  established by the
Committee  to  receive  the  benefits  specified  hereunder  in the event of the
Participant's death. No beneficiary  designation shall become effective until it
is filed with the Committee. However, no designation of a Beneficiary



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other  than the  Participant's  spouse  shall be valid  unless  consented  to in
writing by such spouse. Any designation shall be revocable at any time through a
written  instrument  filed by the Participant with the Committee with or without
the consent of the previous Beneficiary.  If there is no Beneficiary designation
in effect, or there is no surviving  designated  Beneficiary,  the Participant's
surviving  spouse shall be the  Beneficiary.  If there is no surviving spouse to
receive any benefits payable in accordance with the preceding sentence, the duly
appointed and currently  acting  personal  representative  of the  Participant's
estate (which shall include  either the  Participant's  probate estate or living
trust)  shall be the  Beneficiary.  In any case where there is no such  personal
representative  of the  Participant's  estate duly  appointed and acting in that
capacity within ninety (90) days after the Participant's death (or such extended
period  as the  Committee  determines  is  reasonably  necessary  to allow  such
personal  representative  to be appointed,  but not to exceed one hundred eighty
(180) days  after the  Participant's  death),  then  Beneficiary  shall mean the
person or persons who can verify by affidavit or court order to the satisfaction
of the  Committee  that  they are  legally  entitled  to  receive  the  benefits
specified  hereunder.  In the event any  amount is  payable  under the Plan to a
minor,  payment shall not be made to the minor,  but instead be paid (a) to that
person's living parent(s) to act as custodian,  (b) if that person's parents are
then divorced,  and one parent is the sole custodial  parent,  to such custodial
parent,  or (c) if no  parent  of that  person is then  living,  to a  custodian
selected  by the  Committee  to hold the funds for the minor  under the  Uniform
Transfers  or Gifts to Minors  Act in effect  in the  jurisdiction  in which the
minor  resides.  If no parent is living and the Committee  decides not to select
another custodian to hold the funds for the minor, then payment shall be made to
the duly appointed and currently acting guardian of the estate for the minor or,
if no  guardian  of the estate  for the minor is duly  appointed  and  currently
acting within sixty (60) days after the date the amount becomes payable, payment
shall be  deposited  with the court having  jurisdiction  over the estate of the
minor. Payment by the Company pursuant to any unrevoked Beneficiary designation,
or to the  Participant's  estate if no such designation  exists, of all benefits
owed hereunder shall terminate any and all liability of the Company.

     (d) "Board of Directors" or "Board" shall mean the Board of Directors of CH
Energy Group, Inc.

     (e) "Bonuses" shall mean the incentive  compensation  determined  under the
Company's Executive Incentive Plan earned during the Plan Year.

     (f) "Change of Control" shall mean:

          (1) the  acquisition  by any  individual,  entity or group (within the
     meaning of Section  13(d)(3) or 14(d)(2) of the Securities  Exchange Act of
     1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership
     (within the meaning of Rule 13d-3  promulgated  under the Exchange  Act) of
     20% or more of either (x) the then  outstanding  shares of common  stock of
     the Company (the  "Outstanding  Company  Common Stock") or (y) the combined
     voting  power of the then  outstanding  voting  securities  of the  Company
     entitled to vote generally in the election of directors  (the  "Outstanding
     Company Voting  Securities");  provided,  however that for purposes of this
     subsection (1), the following acquisitions shall not constitute a Change of
     Control:  (i)  any  acquisition   directly  from  the  Company,   (ii)  any
     acquisition by the Company,  (iii) any acquisition by any employee  benefit
     plan (or  related  trust)  sponsored  or  maintained  by the Company or any
     corporation controlled by the Company or (iv) any

                                       -2-
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     acquisition  by any  corporation  pursuant to a transaction  which complies
     with clauses (i), (ii) and (iii) of subsection (3) of this Section  1.2(f);
     or

          (2) Individuals  who, as of December 1, 1998,  constitute the Board of
     Directors of the Company (the  "Incumbent  Board")  cease for any reason to
     constitute at least a majority of the Board;  provided,  however,  that any
     individual  becoming  a  director  subsequent  to  the  date  hereof  whose
     election,  or nomination  for election by the Company's  shareholders,  was
     approved  by  a  vote  of  at  least  a  majority  of  the  directors  then
     compromising  the  Incumbent  Board  shall be  considered  as  though  such
     individual were a member of the Incumbent  Board,  but excluding,  for this
     purpose, any such individual whose initial assumption of office occurs as a
     result of an actual or  threatened  election  contest  with  respect to the
     election or removal of directors or other actual or threatened solicitation
     of proxies or consents by or on behalf of a Person other than the Board; or
     consummation of a reorganization, merger or consolidation or sale, or other
     disposition  of all or  substantially  all of the assets of the  Company (a
     "Business  Combination"),  in each case,  unless,  following  such Business
     Combination,  (i) all or substantially  all of the individuals and entities
     who were the beneficial owners,  respectively,  of the Outstanding  Company
     Common Stock and Outstanding Company Voting Securities immediately prior to
     such Business  Combination  beneficially own, directly or indirectly,  more
     than 60% of, respectively,  the then outstanding voting securities entitled
     to vote generally in the election of directors,  as the case may be, of the
     corporation  resulting from such Business Combination  (including,  without
     limitation,  a corporation  which as a result of such  transaction owns the
     Company or all or substantially all of the Company's assets either directly
     or through one or more  subsidiaries) in substantially the same proportions
     as their ownership,  immediately prior to such Business  Combination of the
     Outstanding Company Common Stock and Outstanding Company Voting Securities,
     as the case may be, (ii) no Person  (excluding  any  corporation  resulting
     from such  Business  Combination  or any employee  benefit plan (or related
     trust) of the  Company or such  corporation  resulting  from such  Business
     Combination)  beneficially  owns,  directly or indirectly,  20% or more of,
     respectively,   the  then  outstanding   shares  of  common  stock  of  the
     corporation resulting from such Business Combination or the combined voting
     power of the then outstanding  voting securities of such corporation except
     to the extent that such ownership existed prior to the Business Combination
     and (iii) at least a majority of the members of the board of  directors  of
     the corporation  resulting from such Business  Combination  were members of
     the Incumbent Board at the time of the execution of the initial  agreement,
     or of the action of the Board, providing for such Business Combination; or

          (3)  Approval  by  the  shareholders  of  the  Company  of a  complete
     liquidation or dissolution of the Company;

     (g) "Change of Control  Payments"  shall mean a payment  from  Company as a
result of a Change of Control;

     (h) "Code" shall mean the Internal Revenue Code of 1986, as amended.

     (i) "Committee"  shall mean the Committee  appointed by the Chief Executive
Officer of the Company to administer  the Plan in  accordance  with Article VII.

                                       -3-

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     (j)  "Company"  shall  mean  CH  Energy  Group,   Inc.  and  any  successor
corporations.  Company  shall  include each  corporation  which is a member of a
controlled  group of  corporations  (within the meaning of Section 414(b) of the
Code) of which CH  Energy  Group,  Inc.  is a  component  member,  if the  Board
provides  that  such  corporation   shall  participate  in  the  Plan  and  such
corporation's governing Board of Directors adopts this Plan.

     (k) "Company Discretionary Contribution Account" shall mean the bookkeeping
account  maintained by the Company for each Participant that is credited with an
amount  equal to the Company  Discretionary  Contribution  Amount,  if any,  and
earnings and losses pursuant to Section 4.2.

     (l)  "Company  Discretionary  Contribution  Amount"  shall  mean,  for each
Participant for a Plan Year, an additional  discretionary  amount allocated to a
Participant under this Plan as determined by the Company. Such amount may differ
from Participant to Participant both in amount,  including no contribution,  and
as a percentage of Compensation.

     (m)  "Compensation"  shall  mean Base  Salary,  Bonuses,  Change of Control
Payments  and  Directors  Fees that the  Participant  is entitled to receive for
services rendered to the Company.

     (n) "Deferral Account" shall mean the bookkeeping account maintained by the
Committee  for each  Participant  that is credited with amounts equal to (1) the
portion  of the  Participant's  Compensation  that he or she  elects  to  defer,
including  any  amounts  deferred  under  the  Central  Hudson  Gas  &  Electric
Corporation  Directors' Deferred  Compensation Plan and income earned thereon as
of the Effective Date, and (2) interest pursuant to Section 4.1.

     (o)  "Directors  Fees"  shall mean the  retainers  and fees a member of the
Board is entitled to receive for  services  rendered in his or her capacity as a
member of the Board.

     (p) "Distributable  Amount" shall mean the sum of the amounts credited to a
Participant's  Deferral  Account  and  the  Company  Discretionary  Contribution
Account.

     (q) Effective  Date" shall mean January 1, 2000.

     (r) "Eligible Director" shall mean a member of the Board of Directors.

     (s) "Eligible  Employee" shall mean executive officers and other executives
and key management  employees of the Company that meet criteria  approved by the
Committee on Compensation and Succession/Retirement of the Board of Directors.

     (t)  "Eligible  Individual"  shall mean  Eligible  Directors  and  Eligible
Employees.

     (u) "Fund" or "Funds"  shall  mean one or more of the  investment  funds or
Policies selected by the Committee pursuant to Section 3.2(b).

     (v) "Hardship  Distribution"  shall mean a severe financial hardship to the
Participant  resulting from a sudden and  unexpected  illness or accident of the
Participant or of his

                                       -4-

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or her  Dependent  (as  defined  in  Section  152(a)  of the  Code),  loss  of a
Participant's  property  due to casualty,  or other  similar  extraordinary  and
unforeseeable  circumstances arising as a result of events beyond the control of
the  Participant.  The  circumstances  that would  constitute  an  unforeseeable
emergency will depend upon the facts of each case,  but, in any case, a Hardship
Distribution  may not be made to the  extent  that  such  hardship  is or may be
relieved (i) through  reimbursement  or  compensation by insurance or otherwise,
(ii) by liquidation of the  Participant's  assets, to the extent the liquidation
of such assets  would not itself cause severe  financial  hardship,  or (iii) by
cessation of deferrals under this Plan.

     (w) "Initial  Election  Period" for an Eligible  Individual  shall mean the
thirty (30) day period  prior to December 20, 1999 or the thirty (30) day period
following  the time an  employee  or  member of the Board  becomes  an  Eligible
Individual.

     (x) "Rate of Return"  shall  mean for each Fund an amount  equal to the net
rate of gain or loss on the assets of such Fund  during the period  amounts  are
invested in the Fund.

     (y) "Long Term  Disability"  shall have the same meaning as provided in the
long term disability  policy  maintained by the Company for its senior executive
employees.

     (z)  "Non-Scheduled  In-Service  Withdrawal"  shall mean an  election  by a
Participant  in  accordance  with Section 6.2 to receive a withdrawal of amounts
from his or her Deferral Account and Company Discretionary  Contribution Account
prior to the time in which such Participant  would otherwise be entitled to such
amounts.

     (aa)  "Participant"  shall  mean any  Eligible  Individual  who  becomes  a
Participant in accordance with Article II.

     (bb) "Payment  Date" for payment of a  Distributable  Amount shall mean the
time as soon as  administratively  practicable after (1) the end of the calendar
quarter in which the Participant's  employment terminates for any reason, or (2)
the Scheduled In-Service Withdrawal Date.

     (cc) "Plan" shall mean the CH Energy Group,  Inc.  Directors and Executives
Deferred  Compensation Plan set forth herein,  now in effect, or as amended from
time to time.

     (dd) "Plan Year" shall mean the initial period beginning on January 1, 2000
and ending on December 31, 2000 and thereafter the twelve (12) consecutive month
period beginning on each January 1 and ending on each December 31.

     (ee) "Retirement"  shall mean the  Participant's  termination of employment
with the Company on or after age fifty-five (55).

     (ff) "Scheduled  In-Service Withdrawal Date" shall be the distribution date
elected  by the  Participant  for an  in-service  withdrawal  of all  amounts of
Compensation   deferred  in  a  given  Plan  Year  and   Company   Discretionary
Contribution Amounts, and earnings and losses attributable thereto, as set forth
on the election form for such Plan Year.

                                       -5-

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     (gg) "Trust" shall mean the CH Energy Group, Inc.  Directors and Executives
Deferred Compensation Plan Trust.

     (hh) "Trustee" shall mean the trustee of the Trust.

                                   ARTICLE II

                                  PARTICIPATION

      A Participant in the Central Hudson Gas & Electric Corporation  Directors'
Deferred  Compensation Plan in effect immediately prior to the Effective Date of
this Plan shall continue such  participation  as a Participant in this Plan. Any
other Eligible Individual shall become a Participant in this Plan by electing to
defer a portion of his or her Compensation in accordance with Section 3.1.


                                  ARTICLE III

                               DEFERRAL ELECTIONS

     3.1 Elections to Defer Compensation.

     (a) Initial Election Period.  Subject to the provisions of Article II, each
Eligible Employee may elect to defer Base Salary,  Bonuses and Change of Control
Payments  by  filing  with  the  Committee  an  election  that  conforms  to the
requirements  of this Section 3.1 on a form provided by the Committee,  no later
than the last day of his or her Initial  Election Period.  An Eligible  Director
may,  subject to the provisions of Article II elect to defer  Directors' Fees by
filing with the Committee an election that  conforms  with the  requirements  of
this Section 3.1, on a form  provided by the  Committee,  no later than the last
day of his or her Initial Election Period.

     (b) General Rule. The amount of Compensation  which an Eligible  Individual
may elect to defer is such Compensation earned on or after the time at which the
Eligible  Individual  elects to defer  Compensation  in accordance with Sections
1.2(w) and 3.1(a).  The amount  elected by an Eligible  Employee shall be a flat
dollar  amount or a  percentage  of Base  Salary,  Bonus and  Change of  Control
Payments which shall not exceed 50% of the Eligible  Employee's Base Salary, and
100% of the Eligible Employee's Bonus and 100% of any Change of Control Payment,
provided that the total amount deferred by an Eligible Employee shall be limited
in any calendar year, to an annual amount that results in an Eligible Employee's
Compensation being not less than the Social Security Wage Base. In addition, the
Committee may in its sole and absolute  discretion  further limit  deferrals for
income tax withholding and employee  benefit plan withholding  requirements.  An
Eligible  Director  may  defer  up to 100% of his or her  Director's  Fees.  The
minimum  contribution  which  may  be  made  in any  Plan  Year  by an  Eligible
Individual shall not be less than 25% of the expected target  contribution which
can be  satisfied  from  either Base  Salary,  targeted  Bonuses,  and Change of
Control  Payments  or  Directors  Fees,  whether  or not the  targeted  bonus is
actually earned.


     (c) Duration of  Compensation  Deferral  Election.  An Eligible  Employee's
initial  election to defer Base Salary must be filed on or before  December  20,
1999 and is to be effective for the first day of the next following Plan Year. A
Participant may renew, increase,

                                       -6-

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decrease or  terminate a deferral  election  with respect to Base Salary for any
subsequent  Plan Year by filing a new  election  on or before  December 20 which
election shall be effective on the first day of the next following Plan Year. An
Eligible Employee's Initial Election to defer Bonuses earned during the calendar
year ended  December  31,  2000 must be filed prior to December  20,  1999.  Any
subsequent  election with respect to bonuses must be filed by December 20 of the
year prior to the year that the  Bonuses  are  earned.  An  Eligible  Employee's
Election  with respect to a Change of Control  Payment must be made on or before
December 20 and shall be effective on the first day of the next  following  Plan
Year.  An Eligible  Employee  may change his or her  election  with respect to a
Change of Control  Payment at least one year prior to any Change of Control,  in
order for such election to become effective.

     An Election by an Eligible  Director must be made on or before  December 20
of the year prior to the year in which the Director's Fees are earned.

     All elections under this Section 3.1 shall be for a period of one (1) year.
In the case of an employee or director who becomes an Eligible  Individual on or
after January 1, 2000, such Eligible Individual shall have thirty (30) days from
the date he or she has become an Eligible Individual to make an Initial Election
with respect to amounts  capable of being deferred under the Plan. Such election
shall be for the remainder of the Plan Year.

     (d) Elections  other than  Elections  during the Initial  Election  Period.
Subject to the  limitations  of Section 3.1(b) above,  any Eligible  Employee or
Eligible  Director  who fails to elect to defer  Compensation  during his or her
Initial Election Period may subsequently become a Participant,  and any Eligible
Employee or Eligible Director who has terminated a prior  Compensation  deferral
election may elect to again defer Compensation, by filing an election, on a form
provided by the Committee, to defer Compensation as described in Sections 3.1(b)
and 3.1(c) above. An election to defer  Compensation  must be filed on or before
December 20 and will be effective for Compensation  earned in the next following
Plan Year.

     3.2 Investment  Elections.

     (a) At the time of making the deferral elections  described in Section 3.1,
the Participant shall designate, on a form provided by the Committee,  the types
of investments  the  Participant's  Account will be deemed to be invested in for
purposes of determining the amount of earnings and losses to be credited to that
Account. In making the designation pursuant to this Section 3.2, the Participant
may specify that all or any multiple of his or her Deferral  Account and Company
Discretionary  Contribution  Account be deemed to be  invested in one or more of
the types of investments  provided under the Plan. A Participant  may change the
designation  made under this Section 3.2 each day in accordance  with procedures
established  by the  Committee.  If a  Participant  fails  to  elect  a type  of
investment  fund  under  this  Section  3.2,  he or she  shall be deemed to have
elected the Money Market type of investment fund.

     (b) Although the Participant may designate the type of investment  funds in
Section 3.2(a) above, the Committee shall not be bound by such designation.  The
Committee shall select from time to time, in its sole discretion, a commercially
available investment fund of each of the types provided under the Plan to be the
Funds. The Rate of Return of each such

                                       -7-

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commercially  available investment fund shall be used to determine the amount of
earnings or losses to be credited to Participant's Account under Article IV.

                                   ARTICLE IV

                       DEFERRAL ACCOUNTS AND TRUST FUNDING

4.1   Deferral Accounts.

      The Committee  shall  establish  and maintain a Deferral  Account for each
Participant under the Plan. Each Participant's Deferral Account shall be further
divided into separate subaccounts ("investment fund subaccounts"), each of which
corresponds to an investment fund elected by the Participant pursuant to Section
3.2(a). A Participant's Deferral Account shall be credited as follows:

     (a) Within  five (5) days after each  payroll  date,  the  Committee  shall
credit the investment fund  subaccounts of the  Participant's  Deferral  Account
with an amount equal to the Compensation deferred by the Participant during each
pay period in accordance with the  Participant's  election under Section 3.2(a);
that  is,  the  portion  of the  Participant's  deferred  Compensation  that the
Participant  has  elected  to be deemed  to be  invested  in a  certain  type of
investment   fund  shall  be  credited  to  the   investment   fund   subaccount
corresponding to that investment fund;

     (b) As of each day, each  investment  fund  subaccount  of a  Participant's
Deferral Account shall be credited with earnings or losses in an amount equal to
that  determined by multiplying  the balance  credited to such  investment  fund
subaccount  as  of  the  preceding  day  plus  contributions   credited  to  the
Participant's Deferral Account since the preceding day by the Rate of Return for
the corresponding fund selected by the Company pursuant to Section 3.2(b).

     (c) In the event that a Participant elects for a given Plan Year's deferral
of  Compensation  to have a Scheduled  In-Service  Withdrawal  Date, all amounts
attributed to the deferral of Compensation for such Plan Year shall be accounted
for  in  a  manner  which  allows  separate   accounting  for  the  deferral  of
Compensation  and investment  gains and losses  associated with such Plan Year's
deferral of Compensation.

4.2 Company Discretionary Contribution Account.

      If  necessary,  the  Committee  shall  establish  and  maintain  a Company
Discretionary  Contribution  Account for each  Participant  under the Plan. Each
Participant's  Company  Discretionary  Contribution  Account  shall  be  further
divided  into  separate   investment  fund  subaccounts   corresponding  to  the
investment  fund  elected  by the  Participant  pursuant  to Section  3.2(a).  A
Participant's  Company  Discretionary  Contribution Account shall be credited as
follows:

     (a) Within  five (5) days after each  payroll  date,  the  Committee  shall
credit  the   investment   fund   subaccounts  of  the   Participant's   Company
Discretionary   Contribution  Account  with  an  amount  equal  to  the  Company
Discretionary Contribution Amount, if any, applicable to that Participant,  that
is, the portion of the Company Discretionary Contribution Amount, if any,


                                       -8-

<PAGE>

which the  Participant  elected to be deemed to be invested in a certain type of
investment  fund  shall  be  credited  to  the  corresponding   investment  fund
subaccount; and

     (b) As of each day, each  investment  fund  subaccount  of a  Participant's
Company  Discretionary  Contribution  Account shall be credited with earnings or
losses in an amount equal to that determined by multiplying the balance credited
to such  investment  fund  subaccount  as of the  prior  day plus  contributions
credited to the Participant's Company  Discretionary  Contribution Account since
the preceding day by the Rate of Return for the  corresponding  Fund selected by
the Company pursuant to Section 3.2(b).

     (c) In the event that a Participant  elects for a given Plan Year's Company
Discretionary  Contribution  Amount to have a  Scheduled  In-Service  Withdrawal
Date, all amounts attributed to the Company  Discretionary  Contribution  Amount
for such Plan Year shall be  accounted  for in a manner  which  allows  separate
accounting  for the Company  Discretionary  Contribution  Amount and  investment
gains  and  losses  associated  with  such  Plan  Year's  Company  Discretionary
Contribution Amount.

4.3 Trust Funding.

      The Company has created a Trust with First American Trust Company  serving
as initial  trustee.  The Company  shall cause the Trust to be funded each year.
The Company shall  contribute  to the Trust an amount equal to the  Compensation
deferred  by  each  Participant  for the  Plan  Year.  The  Company  shall  also
contribute   to  the  Trust  an  amount  equal  to  the  Company   Discretionary
Contribution Amount, if any, for the Plan Year.

      Although the principal of the Trust and any earnings thereon shall be held
separate and apart from other funds of Company and shall be used exclusively for
the uses and  purposes  of Plan  Participants  and  beneficiaries  as set  forth
therein,  neither  the  Participants  nor  their  beneficiaries  shall  have any
preferred  claim on, or any  beneficial  ownership  in,  any assets of the Trust
prior to the time such assets are paid to the  Participants or  beneficiaries as
benefits and all rights  created under this Plan shall be unsecured  contractual
rights of Plan  Participants and beneficiaries  against the Company.  Any assets
held in the Trust will be subject to the claims of Company's  general  creditors
under  federal  and state law in the event of  insolvency  as defined in Section
4.2(a) of the Trust.

      The assets of the Plan and Trust  shall  never inure to the benefit of the
Company  and the same  shall  be held for the  exclusive  purpose  of  providing
benefits to  Participants  and their  beneficiaries.  The sole  exception to the
foregoing  shall be amounts that remain after  payment to a  Participant  of the
Participant's  vested  Account  balance,  if any,  shall be  transferred  by the
Trustee to the Company.

                                    ARTICLE V

                                     VESTING

      A  Participant's  Deferral  Account  shall be 100% vested at all times.  A
Participant's Company Discretionary  Contribution Account, if any, shall be 100%
vested  in the  event of a Change  of  Control  and,  otherwise,  shall  vest in
accordance  with rules  established  by the

                                       -9-

<PAGE>

Company,  in its  sole and  absolute  discretion.  Such  rules  are  hereby
incorporated by this reference into the Plan.

                                   ARTICLE VI

                                  DISTRIBUTIONS

     6.1  Distribution  of  Deferred   Compensation  and  Discretionary  Company
Contributions.

          (a) Distribution Without Scheduled In-Service  Withdrawal Date. In the
     case of a Participant  who terminates  employment due to Retirement or Long
     Term Disability,  the Distributable Amount shall be paid to the Participant
     (and  after  his or her  death  to his or her  Beneficiary)  in the form of
     substantially   equal  quarterly   installments  over  fifteen  (15)  years
     beginning on his or her Payment  Date.  Notwithstanding  the  foregoing,  a
     Participant  described in the  preceding  sentence may elect from among the
     following optional forms of benefit which may be elected by the Participant
     on the form  provided  by the Company  during his or her  Initial  Election
     Period:

               (1) A lump sum payment on the Participant's Payment Date;

               (2)  Substantially  equal  quarterly  installments  over five (5)
          years beginning on the Participant's Payment Date; and

               (3)  Substantially  equal  quarterly  installments  over ten (10)
          years beginning on the Participant's Payment Date;

      Notwithstanding,   any  provision  to  the   contrary,   in  the  event  a
Participant's  Distributable  Amount is less than  $25,000,  such  Distributable
Amount shall be distributed to the Participant or his Beneficiary in a lump sum.
A  Participant  may change his or her election  with respect to the frequency of
payment,  provided such change in the  frequency of payment  occurs at least one
year prior to the Participant's Retirement or Long Term Disability.

      In  the  event  of   termination  of  employment  for  any  other  reason,
distribution  to the  Participant  shall  be  made  in a lump  sum on his or her
Payment Date.

      The  Participant's  Accounts  shall  continue to be credited with earnings
pursuant  to Section  4.1 of the Plan until all  amounts  credited to his or her
Accounts under the Plan have been distributed.

     (b) Distribution With Scheduled In-Service  Withdrawal Date. In the case of
a  Participant  who has elected a  Scheduled  In-Service  Withdrawal  Date for a
distribution  while still in the employ of the Company,  such Participant  shall
receive  his or her  Distributable  Amount,  but  only  with  respect  to  those
deferrals of Compensation and vested Company Discretionary  Contribution Amounts
and earnings on such deferrals of Compensation and vested Company  Discretionary
Contribution Amounts as shall have been elected by the Participant to be subject
to the Scheduled  In-Service  Withdrawal Date in accordance with Section 1.2(ff)
of the Plan. A Participant's  Scheduled In-Service  Withdrawal Date with respect
to  amounts of  Compensation

                                       -10-

<PAGE>

deferred  in a given Plan Year and  vested  Company  Discretionary  Contribution
Amounts  must be at least two (2)  years  from the last day of the Plan Year for
which the  deferrals  of  Compensation  and Company  Discretionary  Contribution
Amounts are made. A Participant may extend the Scheduled  In-Service  Withdrawal
Date for the deferral of  Compensation  and Company  Discretionary  Contribution
Amounts for any Plan Year,  provided such extension occurs at least one (1) year
before the Scheduled In-Service  Withdrawal Date and is for a period of not less
than  two  (2)  years  from  the  Scheduled  In-Service   Withdrawal  Date.  The
Participant  shall  have the  right to twice  modify  any  Scheduled  In-Service
Withdrawal Date. In the event a Participant  terminates  employment with Company
prior to a  Scheduled  In-Service  Withdrawal  Date,  the  Participant's  entire
Distributable  Amount  will be paid  in a lump  sum as soon as  administratively
practicable  following  the end of the  quarter  in  which  the  termination  of
employment occurs.

     (c) Death  Benefit.  In the event a  Participant  dies  after he or she has
retired  from the  Company  and still has a balance in his or her  Account,  the
balance shall continue to be paid in quarterly installments for the remainder of
the period as elected by the Participant.  In the event a Participant dies while
in the active  employment of the Company,  the  Participant's  Account  balance,
whether  or  not  vested,  will  be  paid  in a lump  sum  to the  Participant's
Beneficiary.

      6.2 Non-Scheduled In-Service Withdrawals.

      A  Participant  shall be  permitted  to elect a  Non-Scheduled  In-Service
Withdrawal  from his or her Deferral  Account and vested  Company  Discretionary
Contribution  Account  prior  to the  Payment  Date,  subject  to the  following
restrictions:

     (a) The election to take a  Non-Scheduled  In-Service  Withdrawal  shall be
made by filing a form provided by and filed with the Committee  prior to the end
of any calendar month.

     (b) The amount of the Non-Scheduled  In-Service withdrawal shall be paid in
a single  cash lump sum as soon as  practicable  after  the end of the  calendar
month in which the Non-Scheduled In-Service Withdrawal election is made.

     (c) If a Participant requests a Non-Scheduled  In-Service Withdrawal of his
entire Deferral Account and vested Company  Discretionary  Contribution Account,
10% of the  Deferral  Account  and  vested  Company  Discretionary  Contribution
Account shall be permanently  forfeited and the Company shall have no obligation
to the Participant or his Beneficiary with respect to such forfeited  amount. If
a Participant  receives a Non-Scheduled  In-Service  Withdrawal of less than the
entire Deferral Account and vested Company  Discretionary  Contribution Account,
such  Participant  shall forfeit 10% of the gross amount to be distributed  from
the Participant's Deferral Account and vested Company Discretionary Contribution
Account.

     (d) If a  Participant  receives a  Non-Scheduled  In-Service  Withdrawal of
either  all  or a  part  of  his  Deferral  Account  and  Company  Discretionary
Contribution  Account,  the Participant will be ineligible to participate in the
Plan for the balance of the Plan Year and for the following Plan Year.

                                       -11-

<PAGE>

     6.3 Hardship Distribution.

      A  Participant  shall be  permitted  to elect a Hardship  Distribution  in
accordance with Section 1.2(v) of the Plan prior to the Payment Date, subject to
the following restrictions:

     (a) The election to take a Hardship  Distribution shall be made by filing a
form  provided  by and filed  with  Committee  prior to the end of any  calendar
month.

     (b) The  Committee  shall  have  made a  determination  that the  requested
distribution  constitutes a Hardship  Distribution  in  accordance  with Section
1.2(v) of the Plan.

     (c) The amount determined by the Committee as a Hardship Distribution shall
be paid in a single  cash lump sum as soon as  practicable  after the end of the
calendar month in which the Hardship  Distribution election is made and approved
by the Committee.

     (d) If a Participant receives a Hardship Distribution, the Participant will
be  ineligible to  participate  in the Plan for the balance of the Plan Year and
the following Plan Year.


     6.4 Inability to Locate Participant.

      In the event  that the  Committee  is unable  to locate a  Participant  or
Beneficiary within two (2) years following the required Payment Date, the amount
allocated  to the  Participant's  Account  shall be  forfeited.  If,  after such
forfeiture,  the  Participant  or  Beneficiary  later claims such benefit,  such
benefit shall be reinstated without interest or earnings.

                                  ARTICLE VII

                                 ADMINISTRATION

     7.1 Committee.

      A Committee shall be appointed by, and serve at the pleasure of, the Board
of Directors. The number of members comprising the Committee shall be determined
by the Board which may from time to time vary the number of members. A member of
the Committee may resign by delivering a written  notice of  resignation  to the
Chief Executive  Officer.  The Chief Executive  Officer may remove any member by
delivering  a  certified  copy of its  resolution  of  removal  to such  member.
Vacancies in the  membership  of the Committee  shall be filled  promptly by the
Chief Executive Officer.


     7.2 Committee Action.

      The Committee  shall act at meetings by affirmative  vote of a majority of
the members of the Committee.  Any action permitted to be taken at a meeting may
be taken  without a meeting if, prior to such action,  a written  consent to the
action is signed by all members of the  Committee  and such  written  consent is
filed with the  minutes of the  proceedings  of the  Committee.  A member of the
Committee  shall not vote or act upon any matter which relates  solely to him or
herself as a  Participant.  The  Chairman or any other  member or members of the
Committee

                                       -12-

<PAGE>

designated  by the  Chairman  may  execute  any  certificate  or  other  written
direction on behalf of the Committee.

     7.3 Powers and Duties of the Committee.

     (a) The Committee,  on behalf of the Participants and their  Beneficiaries,
shall enforce the Plan in accordance  with its terms,  shall be charged with the
general  administration  of the Plan,  and shall  have all powers  necessary  to
accomplish its purposes, including, but not by way of limitation, the following:

          (1) To select the Funds in accordance with Section 3.2(b) hereof;

          (2) To construe and interpret the terms and provisions of this Plan;

          (3) To compute and certify to the amount and kind of benefits  payable
     to Participants and their Beneficiaries;

          (4)  To  maintain  all  records   that  may  be   necessary   for  the
     administration of the Plan;

          (5) To provide for the disclosure of all information and the filing or
     provision of all reports and statements to  Participants,  Beneficiaries or
     governmental agencies as shall be required by law;

          (6) To make and publish such rules for the  regulation of the Plan and
     procedures for the  administration of the Plan as are not inconsistent with
     the terms hereof;

          (7)  To  appoint  a plan  administrator  or any  other  agent,  and to
     delegate   to  them  such  powers  and  duties  in   connection   with  the
     administration  of  the  Plan  as the  Committee  may  from  time  to  time
     prescribe; and

          (8) To take all actions necessary for the  administration of the Plan,
     including determining whether to hold or discontinue the Policies.

     7.4 Construction and Interpretation.

      The  Committee  shall have full  discretion  to construe and interpret the
terms and provisions of this Plan, which  interpretations  or construction shall
be final and binding on all  parties,  including  but not limited to the Company
and any  Participant or Beneficiary.  The Committee shall  administer such terms
and provisions in a uniform and nondiscriminatory  manner and in full accordance
with any and all laws applicable to the Plan.

     7.5 Information.

      To enable the Committee to perform its functions, the Company shall supply
full and timely  information  to the  Committee  on all matters  relating to the
Compensation  of all  Participants,  their  death or other  events  which  cause
termination of their  participation in this Plan, and such other pertinent facts
as the Committee may require.

                                       -13-

<PAGE>

          7.6 Compensation, Expenses and Indemnity.

     (a) The members of the Committee shall serve without compensation for their
services hereunder.

     (b) The  Committee  is  authorized  at the expense of the Company to employ
such legal counsel as it may deem advisable to assist in the  performance of its
duties hereunder. Expenses and fees in connection with the administration of the
Plan shall be paid by the Company.

     (c) To the extent  permitted by  applicable  state law,  the Company  shall
indemnify and save harmless the Committee and each member thereof,  the Board of
Directors  and any delegate of the  Committee  who is an employee of the Company
against any and all expenses,  liabilities  and claims,  including legal fees to
defend against such  liabilities  and claims  arising out of their  discharge in
good  faith of  responsibilities  under or  incident  to the  Plan,  other  than
expenses and liabilities arising out of willful misconduct. This indemnity shall
not  preclude  such further  indemnities  as may be  available  under  insurance
purchased by the Company or provided by the Company  under any bylaw,  agreement
or otherwise, as such indemnities are permitted under state law.


     7.7 Quarterly Statements.

      Under procedures established by the Committee, a Participant shall receive
a quarterly statement with respect to such Participant's Accounts.

     7.8 Disputes.

     (a) Claim.

      A person who believes that he or she is being denied a benefit to which he
or she is entitled under this Agreement  (hereinafter referred to as "Claimant")
may file a written request for such benefit with the Company,  setting forth his
or her claim.  The request must be addressed to the  President of the Company at
its then principal place of business.

      (b) Claim Decision.

      Upon  receipt of a claim,  the  Committee  on behalf of the Company  shall
advise the Claimant that a reply will be forthcoming within ninety (90) days and
shall, in fact, deliver such reply within such period. The Company may, however,
extend  the  reply  period  for an  additional  ninety  (90)  days  for  special
circumstances.

      If the claim is denied in whole or in part,  the Company  shall inform the
Claimant in writing, using language calculated to be understood by the Claimant,
setting  forth:  (A) the  specified  reason or reasons for such denial;  (B) the
specific  reference  to  pertinent  provisions  of this  Agreement on which such
denial is based;  (C) a description  of any  additional  material or information
necessary for the Claimant to perfect his or her claim and an explanation of why
such material or such information is necessary;  (D) appropriate  information as
to the steps to be

                                       -14-

<PAGE>

taken if the  Claimant  wishes to submit the claim for review;  and (E) the time
limits for requesting a review under subsection (c).


      (c) Request For Review.

      Within  sixty (60) days after the  receipt by the  Claimant of the written
opinion  described above, the Claimant may request in writing that the Committee
review the  determination of the Company.  Such request must be addressed to the
Secretary of the Company, at its then principal place of business.  The Claimant
or his or her duly  authorized  representative  may,  but need not,  review  the
pertinent  documents and submit issues and comments in writing for consideration
by the  Committee.  If the Claimant  does not request a review within such sixty
(60) day period,  he or she shall be barred and estopped  from  challenging  the
Company's determination.

       (d) Review of Decision.

      Within  sixty (60) days  after the  Committee's  receipt of a request  for
review, after considering all materials presented by the Claimant, the Committee
will inform the Participant in writing,  in a manner calculated to be understood
by the  Claimant,  the  decision  setting  forth the  specific  reasons  for the
decision  containing  specific  references to the  pertinent  provisions of this
Agreement on which the decision is based. If special  circumstances require that
the sixty (60) day time period be  extended,  the  Committee  will so notify the
Claimant and will render the decision as soon as possible, but no later than one
hundred twenty (120) days after receipt of the request for review.

                                  ARTICLE VIII

                                  MISCELLANEOUS

      8.1   Unsecured General Creditor.

      Participants and their Beneficiaries, heirs, successors, and assigns shall
have no legal or equitable rights,  claims, or interest in any specific property
or assets of the Company.  No assets of the Company  shall be held in any way as
collateral  security for the fulfilling of the  obligations of the Company under
this Plan. Any and all of the Company's assets shall be, and remain, the general
unpledged,  unrestricted assets of the Company.  The Company's  obligation under
the Plan  shall be merely  that of an  unfunded  and  unsecured  promise  of the
Company  to pay money in the  future,  and the  rights of the  Participants  and
Beneficiaries shall be no greater than those of unsecured general creditors.  It
is the  intention  of the Company that this Plan be unfunded for purposes of the
Code and for purposes of Title I of the Employee  Retirement Income Security Act
of 1974.

      8.2   Restriction Against Assignment.

      The Company shall pay all amounts payable  hereunder only to the person or
persons  designated by the Plan and not to any other person or  corporation.  No
part of a Participant's  Accounts shall be liable for the debts,  contracts,  or
engagements  or any  Participant,  his  or her  Beneficiary,  or  successors  in
interest,  nor shall a  Participant's  Accounts be subject to execution by levy,
attachment,  or garnishment or by any other legal or equitable  proceeding,  nor
shall any

                                       -15-

<PAGE>

such person have any right to alienate,  anticipate,  sell,  transfer,  commute,
pledge,  encumber,  or assign any  benefits or payments  hereunder in any manner
whatsoever.  if  any  Participant,  Beneficiary  or  successor  in  interest  is
adjudicated  bankrupt or  purports  to  anticipate,  alienate,  sell,  transfer,
commute, assign, pledge, encumber or charge any distribution or payment from the
Plan, voluntarily or involuntarily, the Committee, in its discretion, may cancel
such distribution or payment (or any part thereof) to or for the benefit of such
Participant,  Beneficiary  or  successor  in  interest  in  such  manner  as the
Committee shall direct.

     8.3 Withholding.

      There shall be deducted from each payment made under the Plan or any other
Compensation  payable to the  Participant (or  Beneficiary)  all taxes which are
required to be withheld by the Company in respect to such  payment or this Plan.
The Company shall have the right to reduce any payment (or  compensation) by the
amount of cash sufficient to provide the amount of said taxes.

     8.4 Amendment, Modification, Suspension or Termination.

      The Chief Executive Officer of the Company may amend,  modify,  suspend or
terminate the Plan in whole or in part, except that no amendment,  modification,
suspension  or  termination  shall  have any  retroactive  effect to reduce  any
amounts  allocated to a Participant's  Accounts.  In the event that this Plan is
terminated,   the  amounts  allocated  to  a  Participant's  Accounts  shall  be
distributed to the Participant or, in the event of his or her death,  his or her
Beneficiary  in a lump  sum  within  thirty  (30)  days  following  the  date of
termination.


     8.5 Governing Law.

      This Plan shall be construed, governed and administered in accordance with
the laws of the State of New York.

     8.6 Receipt or Release.

      Any  payment  to  a  Participant  or  the  Participant's   Beneficiary  in
accordance with the provisions of the Plan shall,  to the extent thereof,  be in
full  satisfaction  of all claims  against the  Committee  and the Company.  The
Committee may require such Participant or Beneficiary,  as a condition precedent
to such payment,  to execute a receipt and release to such effect.

     8.7 Payments on Behalf of Persons Under Incapacity.

      In the event that any amount  becomes  payable  under the Plan to a person
who, in the sole judgment of the Committee,  is considered by reason of physical
or  mental  condition  to be  unable  to give a  valid  receipt  therefore,  the
Committee  may  direct  that such  payment  be made to any  person  found by the
Committee,  in its sole judgment,  to have assumed the care of such person.  Any
payment made pursuant to such determination  shall constitute a full release and
discharge  of the  Committee  and the  Company.

                                       -16-

<PAGE>

     8.8 Limitation of Rights and Employment Relationship.

      Neither  the  establishment  of the Plan and  Trust  nor any  modification
thereof,  nor the  creating  of any  fund or  account,  nor the  payment  of any
benefits  shall be  construed as giving to any  Participant  or other person any
legal or equitable  right against the Company or the trustee of the Trust except
as provided in the Plan and Trust; and in no event shall the terms of employment
of any  Employee  or  Participant  be  modified or in any way be affected by the
provisions of the Plan and Trust.

     8.9 Headings.

      Headings and  subheadings  in this Plan are inserted  for  convenience  of
reference  only  and  are  not  to be  considered  in  the  construction  of the
provisions hereof.

      IN WITNESS WHEREOF, the Company has caused this document to be executed by
its duly  authorized  officer  on this 17th day of December, 1999.


                                    CH ENERGY GROUP, INC.

                                       By:   /s/ Paul J. Ganci
                                          ---------------------

                                       By:      Paul J. Ganci
                                          ---------------------












                                       -17-





<PAGE>