CHANGE OF CONTROL BENEFIT PLAN
                             Dated December 18, 1997


         WHEREAS,  SFS Bancorp,  Inc. (the "Company") is a publicly held company
and, as such, is subject to the possibility of being acquired by another entity;
and

          WHEREAS,  the Company is interested in maintaining the services of its
employees and  especially  its key officers and key officers of its  subsidiary,
Schenectady Federal Savings Bank (the "Bank") ("Executives"); and

         WHEREAS,   the  Company  further   recognizes  that  uncertainties  and
questions may be raised among the Executives  with regard to an acquisition  and
the Company and such  questions  and  concerns  may result in the  departure  or
distraction  of  management  personnel  to the  detriment to the Company and its
stockholders; and

         WHEREAS, the Executives are parties to either employment  agreements or
change of control  severance  agreements (the  "Agreements")  with the Bank that
provide for  reductions to payments to them in the event of a change of control,
in order to prevent  payments from being  nondeductible  for federal  income tax
purposes under Section 280G of the Internal Revenue Code (the "Code"); and

         WHEREAS,  the Company believes it is in its best interests and the best
interests of its  stockholder  to maximize  benefits  paid to  Executives in the
event of a change of control, the Company hereby provides the following plan:

         1. While it is not contemplated that any Executive who is subject to an
employment  agreement or a change of control severance  agreement by and between
the Bank and such  Executive  would  receive any amounts or benefits  under such
agreements that would constitute "excess parachute  payments" under Section 280G
of the Code,  nevertheless,  in the event that any  benefits  provided  or to be
provided to such  Executive  pursuant to such  agreement  when  aggregated  with
payments or benefits,  if any, or other plans  maintained  by the Bank or any of
its  consolidated  subsidiaries  constitute  "excess  parachute  payments" under
Section  280G of the Code that are subject to excise tax under  Section  4999 of
the Code, the Company shall do the following:

                  (i)  Cause the Bank to waive any  provision  of any  agreement
requiring a reduction in any payment in order to avoid  non-deductibility of any
payment pursuant to Section 280G of the Code and shall simultaneously  reimburse
the Bank for any amounts  that it pays as a result of such waiver for the amount
of any tax benefit  plus  reimburse  the Bank the amount of any tax benefit that
the Bank may have lost due such waiver and payment.  It is the intention of this
provision  to put the Bank in the same  position  that it would have been in had
such agreement been paid out in accordance with its terms; and

                  (ii) In the event that any payments or benefits provided or to
be provided to the such  Executive  pursuant to this  Agreement,  in combination
with payments or benefits,  if any, from other plans or arrangements  maintained
by the  Company  or any of the  Consolidated  Subsidiaries,  constitute  "excess
parachute  payments"  under  Section 280G of the Code that are subject to excise
tax under  Section 4999 of the Code,  the Company  shall pay to the Executive in
cash an  additional  amount  equal to the  amount  of the Gross Up  Payment  (as
hereinafter  defined).  The "Gross Up  Payment"  shall be the  amount  needed to
ensure that the amount of such payments and the value of such benefits  received
<PAGE>
by the Executive (net of such excise tax and any federal, state and local tax on
the Company's  payment to him attributable to such excise tax) equals the amount
of such  payments and value of such  benefits as he would receive in the absence
of such excise tax and any federal, state and local tax on the Company's payment
to him  attributable  to such  excise tax.  The  Company  shall pay the Gross Up
Payment  within  30 days  after the date of  termination  of  employment  of the
Executive.  For purposes of determining the amount of the Gross Up Payment,  the
value of any  non-cash  benefits  and  deferred  payments or  benefits  shall be
determined  by  the  Company's  independent  auditors  in  accordance  with  the
principles of Section  280G(d)(3) and (4) of the Code. In the event that,  after
the Gross Up Payment is made,  the amount of the excise tax is  determined to be
less than the amount  calculated  in the  determination  of the actual  Gross Up
Payment made by the Company,  the Executive  shall repay to the Company,  at the
time that such reduction in the amount of excise tax is finally determined,  the
portion of the Gross Up Payment attributable to such reduction, plus interest on
the amount of such repayment at the  applicable  federal rate under Section 1274
of the Code from the date of the Gross Up Payment to the date of the  repayment.
The amount of the reduction of the Gross Up Payment shall reflect any subsequent
reduction  in excise taxes  resulting  from such  repayment.  In the event that,
after the Gross Up Payment is made,  the amount of the excise tax is  determined
to exceed the amount  anticipated at the time the Gross Up Payment was made, the
Company shall pay to the Executive,  in immediately available funds, at the time
that such additional amount of excise tax is finally  determined,  an additional
payment  ("Additional  Gross Up  Payment")  equal to such  additional  amount of
excise tax and any federal, state and local taxes thereon, plus all interest and
penalties,  if any, owed by the Executive with respect to such additional amount
of excise and other tax. The Company shall have the right to  challenge,  on the
Executive's  behalf,  any  excise  tax  assessment  against  him as to which the
Executive  is entitled to (or would be  entitled if such  assessment  is finally
determined  to be  proper) a Gross Up Payment or  Additional  Gross Up  Payment,
provided that all costs and expenses incurred in such a challenge shall be borne
by the  Company and the  Company  shall  indemnify  the  Executive  and hold him
harmless,  on an  after-tax  basis,  from any  excise  or other  tax  (including
interest and penalties with respect thereto) imposed as a result of such payment
of costs and expenses by the Company.

                  (iii) This plan shall not apply to any  individual  who has an
employment agreement with the Company.  This plan shall apply to the individuals
listed on Exhibit A hereto.
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                                    EXHIBIT A

                                Richard D. Ammian

                               David J. Jurczynski

                              Michael J. Krywinski

                                 William Pezzula