Exhibit 10.3

                       THE CATSKILL FINANCIAL CORPORATION
                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
                      (As adopted effective April 1, 1998)

         This  Plan  is  adopted  by   CATSKILL   FINANCIAL   CORPORATION   (the
"Employer").

                                   WITNESSETH:

         WHEREAS,  the Employer  desires to  establish an unfunded  nonqualified
deferred  compensation  plan for a select group of its management  and/or highly
compensated  employees,  to  be  know  as  the  CATSKILL  FINANCIAL  CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (the "Plan");

         NOW,  THEREFORE,  the Plan is hereby adopted,  effective as of April 1,
1998, with the following benefits, terms and provisions:


                                    ARTICLE I
                                     PURPOSE

         The purpose of this Plan is to provide certain Employees  designated by
the  Employer as eligible to  participate  herein with a  supplemental  deferred
compensation plan which is nonqualified and unfunded.


                                   ARTICLE II
                                   DEFINITIONS

         Unless the context  clearly  otherwise  requires,  the following  terms
shall have the meanings given to them below:

         2.1 "Account"  means,  for each  Participant,  the bookkeeping  account
established  hereunder.  A  Participant's  Account  shall  be  comprised  of two
sub-accounts,   the   Participant's   Elective  Account  and  the  Participant's
Non-Elective Account.

         2.2  "Beneficiary"  means  a  person  to  whom a  share  of a  deceased
Participant's  Vested Benefit is payable,  pursuant to the provisions of Section
3.4(e).  For purposes of this Plan,  a  Participant's  Beneficiary  shall be the
Participant's spouse, if surviving,  and the Participant's  children equally, if
the  Participant  shall leave no spouse  surviving;  provided,  however,  that a
Participant may change his Beneficiary at any time upon notice in writing,  in a
form approved by the Committee, and delivered to the Committee.

<PAGE>

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

         2.4  "Committee"  means the Employer's  Compensation  Committee or such
other  committee  designated by the Employer to administer the Plan on behalf of
the Employer.

         2.5  "Compensation"  means, with respect to any Participant,  the total
remuneration  received by the Participant from the Employer during the Plan Year
prior to any reductions under this Plan.

         2.6 "Disability"  means a physical or mental condition of a Participant
resulting  from bodily  injury,  disease,  or mental  disorder which renders him
incapable of continuing  his usual and customary  employment  with the Employer.
The  Disability  of a Participant  shall be  determined by a licensed  physician
chosen  by the  Committee.  The  standard  of  determination  shall  be  applied
uniformly to all Participants.

         2.7 "Elective Account" means, for each Participant,  the portion of the
Participant's  Account  attributable to Compensation  electively deferred by the
Participant pursuant to Section 3.1 below.

         2.8 "Eligible  Employee" means an Employee who the Employer  designates
is  eligible  to  participate  in this Plan.  Each  Eligible  Employee  shall be
identified on Schedule A.

         2.9 "Employee" means any person who is employed by the Employer.

         2.10 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.

         2.11 "Employer" means Catskill Financial Corporation, and any affiliate
which shall adopt this Plan and any successor which shall maintain this Plan.

         2.12 "Entry Date" means,  with  respect to any  Employee,  the date the
Employee  begins to participate in the Plan,  which date shall be not later than
30 days after the date the Employer  first  designates  the Employee as being an
Eligible Employee.

         2.13 "Non-Elective Account" means, for each Participant, the portion of
the Participant's  Account  attributable to non-elective  deferred  compensation
provided pursuant to Section 3.2 below.

         2.14 "Participant" means an Eligible Employee who has accrued a benefit
hereunder.  A person  who  becomes  a  Participant  shall  remain a  Participant
hereunder until he (or his  Beneficiary)  has received his entire Vested Benefit
in accordance with Section 3.4 below.

                                       2
<PAGE>

         2.15 "Plan" means this  instrument  and all amendments  thereto,  which
shall be known as the  Catskill  Financial  Corporation  Supplemental  Executive
Retirement Plan.

         2.16 "Plan  Year" means the  12-month  period  beginning  January 1 and
ending December 31st.

         2.17 "Qualified Plan" means the employee stock ownership plan sponsored
by the  Employer,  as amended from time to time,  which the Employer  intends to
qualify for favorable tax treatment under Code Section 401(a).

         2.18 "Retirement" means the date as of which a Participant  retires for
reasons other than death or  Disability,  whether such  retirement  occurs on or
after a Participant's  normal  retirement date  (attainment of age 65), or on or
after any early retirement date established by uniform nondiscriminatory rule of
the Committee.

         2.19  "Schedule  A" means the Schedule A,  attached  hereto and by this
reference made a part hereof,  as amended or  supplemented  from time to time by
the Employer.

         2.20 "Unforeseeable  Emergency" means, with respect to any Participant,
an unanticipated  emergency that is caused by an event beyond the control of the
Participant (or  Participant's  Beneficiary,  as the case may be) and that would
result in severe financial  hardship to the individual if an early  distribution
of benefits  hereunder  were not  permitted.  It is intended that the definition
provided in the preceding  sentence comply with the definition of "unforeseeable
emergency" provided for in Section 3.01 of Rev. Proc. 92-65.

         2.21  "Vested"  means  the   nonforfeitable   portion  of  any  account
maintained on behalf of a Participant.

         2.22  "Vested  Benefit"  means,  with respect to any  Participant,  the
Vested portion of the Participant's Account.

         2.23 "Year of Service"  shall have the same meaning  under this Plan as
defined in the  Qualified  Plan.  For vesting and all other  purposes,  Years of
Service  under this Plan  shall be  determined  in the same  manner as under the
Qualified Plan.


                                   ARTICLE III
                    DEFERRALS, INVESTMENTS AND DISTRIBUTIONS

         3.1 ELECTIVE DEFERRALS BY PARTICIPANTS.  The provisions of this Section
3.1  shall  apply  to  a  particular  Eligible  Employee  only  if  specifically
authorized by the Employer.

                                       3
<PAGE>

         (a) An Eligible  Employee may elect to defer annually the receipt of an
amount of Compensation  otherwise payable to him by the Employer in any calendar
year.

         (b) An  election  to defer  Compensation  shall be made by a notice  in
writing,  in a form approved by the Committee,  signed by the Eligible Employee,
and  delivered to the  Committee (1) prior to the January 1 of the calendar year
in which the Compensation to be deferred is otherwise payable to the Participant
or (2) prior to a Participant's  Entry Date for the Participant's  first year of
participation  and covering  Compensation  payable to the Participant after such
Entry Date. Such election form shall include the elections  described in Section
3.3 below  (relating  to deemed  investment  elections)  and  Section  3.4 below
(relating to the time and manner of payment).  Such election (and any subsequent
election)  will  continue  until  suspended  or  modified  in  writing in a form
approved by the  Committee and  delivered to the  Committee,  which new election
shall only apply to Compensation  otherwise payable to the Participant after the
end of the calendar year in which such  election is delivered to the  Committee.
Any deferral  election made by the Participant shall be irrevocable with respect
to any Compensation covered by such election, including the Compensation payable
in the calendar  year in which the election  suspending  or modifying  the prior
election is delivered to the Committee.

         (c) The amount of a  Participant's  Compensation  deferred  pursuant to
this Section 3.1 above shall be credited to the Participant's  Elective Account.
A  Participant  shall  always  be fully  (100%)  Vested  in his or her  Elective
Account.

         3.2 NON-ELECTIVE DEFERRALS BY EMPLOYER.

         (a) Subject to the eligibility requirements set forth in Section 3.2(b)
below, there shall be credited to each Participant's  Non-Elective Account for a
Plan Year such  amount,  if any, as shall be  determined  by the Employer in its
sole and absolute  discretion.  The  Employer  may,  under this Section  3.2(a),
declare non-elective deferred  compensation on an individual  Participant basis,
or on behalf of several  Participants as a class, for a single Plan Year or as a
recurring  benefit  for any  number  of Plan  Years,  all on such  terms  as the
Employer shall, in its sole and absolute discretion, determine.

         (b) A  Participant  shall be eligible  to receive a credit  pursuant to
Section 3.2(a) above only if the Employer,  in its sole and absolute discretion,
designates the Participant as being eligible for the credit.

                                       4
<PAGE>

         (c) Unless otherwise specified in Schedule A, the Vested portion of any
Participant's  Non-Elective  Account  shall be a percentage  of the total amount
credited to the Participant's  Non-Elective  Account  determined on the basis of
the  Participant's  number  of  Years  of  Service  according  to the  following
schedule:

                                        Vesting Schedule
                          Years of Service             Percentage

                              Less than 5                   0%
                                   5                      100%

         (d) The Employer may provide  benefit  restoration  benefits and/or any
other benefits to any Participant  under this Section 3.2(d) by setting forth in
Schedule A, the terms of such  benefits  and the  identity  of the  Participants
eligible  to receive  such  benefits.  Any  benefits  provided  pursuant  to the
preceding sentence shall be credited to the subject  Participant's  Non-Elective
Account, unless otherwise specified in Schedule A.

         3.3.  EARNINGS ON ACCOUNTS.  A Participant shall be entitled to elect a
return  on the  value  of  his  Account  based  on the  returns  of one or  more
investment  options  then  authorized  by the  Committee  for  this  Plan.  Each
Participant shall make an election of return at the time he makes an election to
defer compensation hereunder.  Each Participant's Account shall be credited with
gains or losses based on the  performance of the investment  options  elected by
such  Participant  pursuant to uniform  nondiscriminatory  rules  adopted by the
Committee.

         3.4 DISTRIBUTIONS.

         (a) At  the  time a  Participant  elects  to  defer  such  Compensation
pursuant to Section 3.1 above, the Participant  shall designate the time and the
manner  for  the  payment  of  the  amounts  to be  thereby  allocated  to  such
Participant's  Elective  Account with respect to such deferral of  Compensation.
Except as otherwise  provided  below,  payment of the portion of a Participant's
Elective  Account  attributable  to such deferral  shall commence upon the fixed
date  designated  by  the  Participant,  subject  to  such  restrictions  and/or
limitations as may be imposed by the Committee.

         (b) Subject to any elections a Participant may make pursuant to Section
3.4(c) below, the Vested portion of the Participant's Non-Elective Account shall
be paid to the  Participant in quarterly  installments  over a five year period,
with the first quarterly installment being due within 30 days following the date
the Participant's  employment with the Employer  terminates.  The amount of each
quarterly  installment  shall be determined by multiplying the Vested portion of
the Participant's  Non-Elective Account by a fraction, the numerator of which is
one (1) and the denominator of which is the number of installments  remaining to
be  paid  from  the  Participant's  Non-Elective  Account.  Notwithstanding  the

                                       5
<PAGE>

foregoing,  the  amount  of any  quarterly  installment  paid  to a  Participant
pursuant to this Section 3.4(b) shall in no event be less than $5,000.

         (c) A  Participant  may  elect,  in  such  form  and  manner  as may be
prescribed by the Committee, that all or any portion of the Participant's Vested
Benefit be  distributed  commencing  on one or more dates in lieu of the date(s)
initially selected or required hereunder, and/or in one or more forms of payment
in lieu of the form(s) initially selected or required  hereunder,  provided that
any such  election  is made at least 24 months  prior to the  earlier of (1) the
date such  payments  would  otherwise  commence  (other  than on  account  of an
Unforeseeable  Emergency) or (2) the date the Participant's  employment with the
Employer terminates.

         (d) A  Participant  may also  elect,  to the  extent  permitted  by the
Committee,  that an amount up to the entire amount of the  Participant's  Vested
Benefit be distributable in the case of an  Unforeseeable  Emergency.  Any early
distribution  approved  by the  Committee  under  this  Subsection  (d) shall be
limited to the amount necessary to meet the Unforeseeable Emergency.

         (e) If a Participant  should die before his entire  Vested  Benefit has
been paid in accordance with the provisions of this Plan, the remaining  balance
of such Vested Benefit shall be distributable to the  Participant's  Beneficiary
in a  single  lump  sum  payment  within  30  days  following  the  date  of the
Participant's death, if practicable, but in no event more than 90 days following
the date of death.

         (f) Notwithstanding  anything herein to the contrary, the Committee, in
its sole  discretion,  may delay the  distribution of any amounts payable to any
Participant  or Beneficiary to the extent (but only to the extent) the Committee
determines  that payment of such amount would not be  deductible by the Employer
for federal  income tax  purposes  solely by reason of the  application  of Code
Section  162(m)   (relating  to  limitations  on  deductions   with  respect  to
remuneration in excess of $1,000,000 paid to certain executives); provided that,
to the extent payment of any amount is so delayed, such payment shall be made at
the earliest time the Committee determines that the deduction for federal income
tax purposes of such  payment by the Employer  would not be limited by reason of
Code Section 162(m).  Nothing in this Section shall affect the obligation of the
Employer  to make  payments  of  amounts  the  deductibility  of which is not so
limited by Code Section 162(m).

         (g) If any  amounts  deferred  pursuant  to this  Plan  are  found in a
"determination"  (within  the  meaning  of Code  Section  1313(a))  to have been
includable in the gross income by a Participant prior to payment of such amounts
from the Participant's Account, such amounts shall be immediately payable to the
Participant   or  the   Participant's   Beneficiary,   as  the   case   may  be,
notwithstanding anything contained herein to the contrary.

                                       6
<PAGE>

         3.5 CHANGE OF CONTROL PROVISIONS.

             (a) For  purposes  of this  Section  3.5,  the  phrase  "Change  of
Control" shall have the same meaning as defined in the Qualified Plan.

             (b) Notwithstanding any provision contained herein to the contrary:

                 (1) a Participant's Account shall be fully (100%) Vested upon a
Change of Control.

                 (2) the Committee, in its sole and absolute direction, may, but
is not required  to, elect that all Vested  Benefits be payable at the time of a
Change  of  Control  or at any other  time,  regardless  of  whether a Change of
Control occurs, by making an irrevocable  election under this Section in writing
and delivering it to the Employer.


                                   ARTICLE IV
                               PLAN ADMINISTRATION

         4.1 COMMITTEE.

             (a) The Plan shall be administered by the Committee.

             (b) The  Committee  shall act by a majority  of its  members at the
time in office and such action may be taken  either by a vote at a meeting or in
writing without a meeting.  The Committee may authorize in writing any person to
execute any document or documents on its behalf, and any interested person, upon
receipt of notice of such  authorization  directed to it, may thereafter  accept
and rely  upon  any  document  executed  by such  authorized  person  until  the
Committee shall deliver to such interested  person a written  revocation of such
authorization.

             (c) A member of the Committee  who is also a Participant  shall not
vote or act upon any matter relating specifically to himself.

         4.2 POWERS, DUTIES, ETC. OF THE COMMITTEE.

             (a) The Committee  shall have sole and final  authority to construe
the provisions of the Plan and to determine all questions of fact that may arise
under the Plan and any such construction or determination  shall be conclusively
binding upon all persons interested in the Plan.

             (b) Subject to the terms of the Plan,  the  Committee may establish
rules and procedures  satisfactory to it for the  administration of the Plan and
the transaction of its business.

                                       7
<PAGE>

             (c) All  payments of benefits or expenses of the Plan shall be made
by the Employer at the direction of the Committee.

             (d)  The  Committee  may  delegate  to  any  individuals  or  other
committees its responsibilities hereunder.

             (e) The Committee, and the members thereof, shall not be liable for
any action taken or omitted or any  determination or construction  made by it in
good faith  relating to the Plan,  and the  Employer  shall  indemnify  and hold
harmless the Committee,  and the members  thereof,  from and against any cost or
expense  (including  counsel  fees)  or  liability  (including  any sum  paid in
settlement of a claim with the approval of the Committee) arising out of any act
or omission in connection with the Plan, unless arising out of any such person's
own fraud or bad faith.

                                    ARTICLE V
                             AMENDMENT; TERMINATION

         5.1 AMENDMENT.  The Employer's  Board of Directors shall have the right
at any time to amend the Plan in whole or in part,  by an  instrument in writing
or by a resolution duly adopted by the Board of Directors. However, no amendment
shall reduce any benefit to a Participant that has already accrued.

         5.2 TERMINATION.  The Employer's Board of Directors  reserves the right
to  terminate  the  Plan  at any  time.  Upon  termination  of this  Plan,  each
Participant's Account shall become fully Vested, and distribution of the amounts
credited  to  each  such  account  shall  be  made  immediately   following  the
termination in single lump sum payments. No additional amounts shall be credited
to the Accounts of Participants,  following  termination of this Plan other than
interest  and other  earnings or losses  attributable  to the month  immediately
preceding the month of termination.

                                   ARTICLE VI
                                  MISCELLANEOUS

         6.1 FUNDING. The benefit which is provided by the Plan shall be paid by
the  Employer to a  Participant  out of its general  assets and no assets of the
Employer shall be designated to fund the benefit provided herein or deemed to be
assets  to be used for that  purpose,  it being  understood  that the Plan is an
unfunded  plan for tax  purposes  and for  Title I of  ERISA.  The Plan does not
confer on any  Participant or Beneficiary a beneficial  interest in any asset of
the Employer. The rights of Participants and Beneficiaries under this Plan shall
be limited to those of unsecured  general  creditors  of the Company.  This Plan
constitutes  a mere  promise by the  Employer  to make  benefit  payments in the
future.  The  Employer  may,  however,  establish  a trust  pursuant  to a trust
agreement  and make  contributions  thereto for the purpose of  assisting  it in

                                       8
<PAGE>

meeting  its  obligations  hereunder.  Any such trust  agreement  shall  contain
provisions to the following effect:

                       (a)     In the event of the  insolvency  of the Employer,
                       the trust fund will be available to pay the claims of any
                       creditor of the  Employer to whom a  distribution  may be
                       made in  accordance  with  state and  federal  bankruptcy
                       laws.  The Employer  shall be deemed to be "insolvent" if
                       the  Employer  is  subject to a pending  proceeding  as a
                       debtor  under  the  Federal   Bankruptcy   Code  (or  any
                       successor  statute) or any state  bankruptcy code. In the
                       event  the  Employer  becomes  insolvent,  the  Board  of
                       Directors  and Chief  Executive  Officer of the  Employer
                       shall  notify  the  trustee  of  the  event  as  soon  as
                       practicable.  Upon  receipt  of  such  notice,  or if the
                       trustee   receives  other  written   allegations  of  the
                       Employer's  insolvency,  the trustee  shall cease  making
                       payments of benefits from the trust fund,  shall hold the
                       trust fund for the benefit of the  Employer's  creditors,
                       and shall take such steps that are necessary to determine
                       within 30 days whether the Employer is insolvent.  In the
                       case  of  the  trustee's  actual  knowledge  of or  other
                       determination of the Employer's  insolvency,  the trustee
                       will deliver  assets of the trust fund to satisfy  claims
                       of the  Employer's  creditors  as  directed by a court of
                       competent jurisdiction.

                       (b)     The  trustee  shall  resume  payments of benefits
                       under the trust  agreement  only  after the  trustee  has
                       determined  that the Employer is not  insolvent (or is no
                       longer insolvent,  if the trustee  previously  determined
                       the Employer to be insolvent) or upon receipt of an order
                       of a  court  of  competent  jurisdiction  requiring  such
                       payment. If the trustee  discontinues payment of benefits
                       pursuant to subsection (a) above and subsequently resumes
                       such   payment,   the  first  payment  on  account  of  a
                       Participant or Beneficiary  following such discontinuance
                       shall  include  an  aggregate  amount  equal  to (1)  the
                       difference between (A) the payments which would have been
                       made on account of such Participant or Beneficiary by the
                       Employer during such period of discontinuance and (B) the
                       amount of payments which were actually made on account of
                       such  Participant or  Beneficiary by the Employer  during
                       such period,  plus (2) interest on such  difference  at a
                       rate  equivalent  to the net rate of return earned by the
                       trust fund during such period.

         6.2 BENEFITS NOT ASSIGNABLE.  Benefits  provided under the Plan may not
be anticipated,  assigned (either at law or in equity),  alienated or subject to
attachment,  garnishment,  levy,  execution or other legal or equitable process,
and may not otherwise be transferred  (except by will or the laws of descent and
distribution).  The  designation  of a Beneficiary  or  Beneficiaries  shall not
constitute a transfer.

         6.3 PLAN NOT A CONTRACT  OF  EMPLOYMENT.  The Plan is not a contract of
employment, and the terms of employment of any Employee shall not be affected in
any way by the Plan or related  instruments  except as specifically  provided in

                                       9
<PAGE>

the Plan or such related instruments. The establishment of the Plan shall not be
construed as conferring any legal rights upon any Employee for a continuation of
employment,  nor  shall it  interfere  with  the  right  of the  Employer  or an
affiliate to discharge any Employee.  Each  Participant  and all persons who may
have or claim any right by reason of their  participation  in the Plan  shall be
bound by the terms of the Plan and all agreements entered into pursuant hereto.

         6.4 FACILITY OF BENEFIT PAYMENT.  Whenever, in the Committee's opinion,
a person entitled to receive any payment of a benefit hereunder is under a legal
disability  or is  incapacitated  in any way so as to be unable  to  manage  his
financial  affairs,  the  Committee  may direct the Employer to make payments to
such  person or to his legal  representative  or to a relative or friend of such
person for his  benefit,  or to direct the Employer to apply the payment for the
benefit of such person in such manner as the Committee considers advisable.  Any
payment  of a  benefit  or  installment  thereof  made in  accordance  with  the
provisions  of this Section 6.4 shall be a complete  discharge of any  liability
for the making of such payment under the Plan.

         6.5 CONSTRUCTION.

             (a) The Plan is intended to qualify as a plan maintained  primarily
for the  purpose  of  providing  deferred  compensation  for a  select  group of
management or highly compensated  employees within the meaning of Section 201(2)
of ERISA.  It is also  intended  to comply  with the  requirements  set forth in
Section  3 of Rev.  Proc.  92-65.  The Plan  shall be  liberally  construed  and
interpreted  accordingly.  Otherwise,  the laws of the  State of New York  shall
control the interpretation and performance of the terms of the Plan.

             (b) If any  provision of the Plan, or the  application  of any such
provision to any person or  circumstances,  shall be invalid  under any Federal,
State  or  local  law,  rule or  regulation,  neither  the  application  of such
provision  to  persons  or  circumstances  other  than  those as to  which  such
provision  is invalid  nor any other  provisions  of the Plan shall be  affected
thereby.

             (c) The headings and subheadings in the Plan have been inserted for
convenience of reference only, and are to be ignored in any  construction of the
provisions thereof.

             (d) The  masculine  pronoun  wherever used herein shall include the
feminine and the singular  number shall  include the plural,  unless a different
meaning is plainly required by the context.

         6.6.  WITHHOLDING.  All payments made hereunder shall be subject to any
applicable income tax, employment tax or other tax withholding requirements.

                                       10
<PAGE>

         6.7 EFFECTIVE DATE. This Plan shall take effect as of April 1, 1998.

         IN WITNESS  WHEREOF,  this Plan has been executed by a duly  authorized
agent of the Employer this 19TH day of MAY, 1998.


         EMPLOYER:                          CATSKILL FINANCIAL CORP.


                                            By: /s/ Allan Oren
                                            ------------------------------------
                                            As its: Director


                                       11
<PAGE>

                                   SCHEDULE A

                                       to

                       THE CATSKILL FINANCIAL CORPORATION
                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
                      (As Adopted Effective April 1, 1998)


         1.       ELIGIBLE EMPLOYEE.  Each of the following individuals shall be
an "Eligible Employee" under the Plan:

                       Wilbur J. Cross, President and CEO

         2.       NONELECTIVE  DEFERRALS.  The following  non-elective  deferred
compensation is provided pursuant to Section 3.2(a) of the Plan:

                               None at this time.

         3.       BENEFIT RESTORATION AND/OR OTHER BENEFITS.

                  (a)    The following  benefits  shall be provided to Wilbur J.
                         Cross, President and CEO, pursuant to Section 3.2(d) of
                         the Plan:

                         (i)  During  calendar  year 1998,  the  Employer  shall
                              credit to the Participant's  Non-Elective  Account
                              the sum of $60,000.

                         (ii) During  calendar  year 1999,  the  Employer  shall
                              credit to the Participant's  Non-Elective  Account
                              an additional sum of $80,000.

                         (iii)During  the period  beginning  January 1, 2000 and
                              ending March 31, 2000,  the Employer  shall credit
                              to  the  Participant's   Non-Elective  Account  an
                              additional sum of $20,000.

                         All benefits accrued under the Plan attributable to the
                         credits  granted to the  Participant  pursuant  to this
                         Item 3(a) shall be fully (100%) Vested at all times.

                                       12