BEACON FEDERAL

                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

     This Supplemental  Executive  Retirement Plan (the "Plan"),  is established
effective  January 1, 2008, for the purpose of providing  additional  retirement
benefits  to certain  members  of senior  management  ("Participants")  who have
contributed  significantly  to the  success  and  growth  of Beacon  Federal,  a
federally  chartered  savings  association  with its  principal  office  in East
Syracuse,  New York (the  "Bank"),  and whose  services  are vital to the Bank's
continued growth and success.

                                    ARTICLE I

                                   DEFINITIONS
                                   -----------

     When used herein,  the following words shall have the meanings below unless
the context clearly indicates otherwise:

     1.1  "Annual   Compensation"   means  the  highest   base  salary  paid  or
attributable  to the  Participant  during either the current Plan Year or any of
the previous three full Plan Years,  including amounts deferred at Participant's
election to any  tax-qualified  or  non-qualified  employee  benefit plan of the
Bank.

     1.2 "Beneficiary"  means the person(s)  designated by Participant from time
to time, using the Beneficiary  Designation Form set forth on the  Participant's
Benefit Schedule,  as the  beneficiary(ies)  to whom the deceased  Participant's
account  will  be  payable.  If  no  beneficiary  is  so  designated,  then  the
Participant's estate will be the Beneficiary.

     1.3 "Benefit  Schedule"  means the  personalized  description of the Plan's
operational  provisions that pertain to each Participant,  including (a) date of
participation in the Plan; (b) Normal Retirement Age; (c) vesting schedule;  (d)
Retirement  Benefit;  and (e) Liability  Reserve Account.  All Benefit Schedules
shall be treated as being an  integral  part of this  Plan,  but no  Participant
shall have the right to any information  about any other  Participant's  Benefit
Schedule.

     1.4 "Board" means the Bank's Board of Trustees.

     1.5  "Cause"  means  termination  because  of  the  Participant's  personal
dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving
personal  profit,  material  breach  of the  Bank's  Code  of  Ethics,  material
violation of the  Sarbanes-Oxley  requirements for officers of public companies,
if  applicable,  that in the  reasonable  opinion of the Board will likely cause
substantial  financial harm or substantial  injury to the reputation of the Bank
of any holding  company of the Bank,  willfully  engaging in actions that in the
reasonable opinion of the Board will likely cause substantial  financial harm or
substantial injury to the business  reputation of the Bank,  intentional failure
to perform  stated  duties,  willful  violation of any law,  rule or  regulation
(other  than  routine   traffic   violations  or  similar   offenses)  or  final
cease-and-desist  order,  or material breach of any provision of this Agreement.
The  Participant  shall  not be  terminated  for  Cause  unless  there  has been
delivered  to the  Participant  a copy of the  resolution  duly  adopted  by the
affirmative vote of not less than three-quarters of the entire membership of the
Board at a meeting  called for that purpose,  informing the  Participant  of the
Board's decision and stating the particulars  thereof in detail. The Participant
shall be given  reasonable  advance  notice of such meeting and the  Participant
(together  with  counsel)  shall have an  opportunity  to be heard  before  such
meeting prior to the matter being voted on by the Board.

<PAGE>

     1.6 "Committee" means the Compensation  Committee of the Board who shall be
responsible for administering the Plan.

     1.7 "Change in Control"

     (a)  Except  for  payments  that  are  subject  to the  Code  Section  409A
definition  of "Change  in  Control"  set forth in  subsection  (b)  below,  for
purposes of this Agreement,  the term "Change in Control" shall mean, any of the
following:

          (i) a change in  control  of a nature  that  would be  required  to be
reported in response  to Item  5.01(a) of the current  report on Form 8-K, as in
effect on the date  hereof,  pursuant  to Section 13 or 15(d) of the  Securities
Exchange Act of 1934, as amended (the "Exchange Act"); or

          (ii) a change in  control of the Bank  within the  meaning of the Home
Owners' Loan Act, as amended  ("HOLA"),  and  applicable  rules and  regulations
promulgated thereunder, as in effect at the time of the Change in Control; or

          (iii) any of the  following  events,  upon  which a Change in  Control
shall be deemed to have occurred:

               (A) any "person" (as the term is used in Sections 13(d) and 14(d)
of the Exchange  Act) is or becomes the  "beneficial  owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the Bank
or the Bank's holding  company  representing  25% or more of the combined voting
power of such outstanding securities, except for any securities purchased by any
employee stock ownership plan or trust established by the Bank; or

               (B)  individuals  who  constitute the Board on the Effective Date
(the  "Incumbent  Board") cease for any reason to constitute at least a majority
thereof,  provided  that  any  person  becoming  a  director  subsequent  to the
Effective Date whose election was approved by a vote of at least  three-quarters
of the  directors  comprising  the  Incumbent  Board,  or whose  nomination  for
election by  stockholders of the Bank or the Bank's holding company was approved
by the same Nominating Committee serving under an Incumbent Board, shall be, for
purposes of this subsection  (B),  considered as though they were members of the
Incumbent Board; or

               (C) a sale of all or substantially  all the assets of the Bank or
the Bank's holding company, or a plan of reorganization,  merger, consolidation,
or similar  transaction  occurs in which the security holders of the Bank or the
Bank's holding company  immediately prior to the consummation of the transaction
do not own at least  50.1%  of the  securities  of the  surviving  entity  to be
outstanding upon consummation of the transaction; or

<PAGE>

               (D)  a  proxy  statement  is  issued   soliciting   proxies  from
stockholders of the Bank or the Bank's holding company by someone other than the
current  management  of the Bank or the  holding  company  of the Bank,  seeking
stockholder approval of a plan of reorganization, merger or consolidation of the
Bank or the Bank's  holding  company,  or similar  transaction  with one or more
corporations  as a result  of  which  the  outstanding  shares  of the  class of
securities  then subject to the plan are to be exchanged  for or converted  into
cash or  property  or  securities  not issued by the Bank or the Bank's  holding
company; or

               (E) a  tender  offer  is  made  for  25% or  more  of the  voting
securities of the Bank or the Bank's holding company,  and  stockholders  owning
beneficially or of record 25% or more of the outstanding  securities of the Bank
or the Bank's  holding  company  have  tendered or offered to sell their  shares
pursuant to such tender offer and such tendered shares have been accepted by the
tender offeror.


     (b) With respect to any payments  hereunder that are made upon a "Change in
Control"  that is subject to Code Section 409A,  "Change in Control"  shall mean
(i) a change in the ownership of the Bank or the Bank's holding company,  (ii) a
change in the effective  control of the Bank or the Bank's holding  company,  or
(iii) a change in the  ownership of a  substantial  portion of the assets of the
Bank or the Bank's holding company, as described below:

          (i) A change in ownership  occurs on the date that any one person,  or
more than one  person  acting as a group (as  defined  in  Treasury  Regulations
section  1.409A-3(i)(5)(v)(B)),  acquires  ownership of stock of the Bank or the
Bank's holding  company that,  together with stock held by such person or group,
constitutes  more than 50% of the total fair market  value or total voting power
of the stock of the Bank or the Bank's holding company.

          (ii) A change  in the  effective  control  of the  Bank or the  Bank's
holding company occurs on the date that either (i) any one person,  or more than
one  person  acting as a group  (as  defined  in  Treasury  Regulations  section
1.409A-3(i)(5)(vi)(B))  acquires  (or has acquired  during the  12-month  period
ending on the date of the most  recent  acquisition  by such  person or persons)
ownership of stock of the Bank or the Bank's holding  company  possessing 30% or
more of the total  voting  power of the stock of the Bank or the Bank's  holding
company,  or (ii) a majority of the members of the Bank's or the Bank's  holding
company's board of directors is replaced during any 12-month period by directors
whose  appointment  or election is not  endorsed by a majority of the members of
the Bank's or the Bank's holding  company's board of directors prior to the date
of the  appointment  or  election,  provided  that this  subsection  (b)(ii)  is
inapplicable  where a majority  shareholder  of the Bank or the  Bank's  holding
company is another corporation.

          (iii) A change in a  substantial  portion  of the Bank's or the Bank's
holding company's assets occurs on the date that any one person or more than one
person  acting  as  a  group  (as  defined  in  Treasury   Regulations   section
1.409A-3(i)(5)(vii)(C))  acquires  (or has acquired  during the 12-month  period
ending on the date of the most  recent  acquisition  by such  person or persons)
assets from the Bank or the Bank's holding  company that have a total gross fair
market  value equal to or more than 40% of the total gross fair market  value of
(i) all of the assets of the Bank or the  Bank's  holding  company,  or (ii) the
value of the assets being  disposed of,  either of which is  determined  without
regard to any liabilities  associated with such assets. For all purposes of this
subsection  (b), the  definition  of Change in Control  shall be construed to be
consistent with the requirements of Treasury Regulations section 1.409A-3(i)(5),
except  to the  extent  that  such  regulations  are  superseded  by  subsequent
guidance.

<PAGE>

     1.8 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.

     1.9  "Disabled"  or  "Disability"  shall be  construed  to comply with Code
Section  409A and  means  that the  Participant:  (a) is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months; or (b) is, by reason of
any medically  determinable  physical or mental impairment which can be expected
to result in death or can be  expected  to last for a  continuous  period of not
less than 12 months,  receiving income replacement  benefits for a period of not
less than 3 months under an accident and health plan  covering  employees of the
Bank or the Bank's holding  company;  or (c) is determined to be disabled by the
Social Security Administration.

     1.10 "Good Reason" means,  within two years following the initial existence
of one or more of the following  conditions  (to which the  Participant  has not
consented),  the Participant  voluntarily  Separates from Service with the Bank,
provided,  however,  that the  Participant  must give the Bank written notice no
later than ninety (90) days after the initial  occurrence  of such event and the
Bank shall have at least thirty (30) days to cure such situation:

                    (a)  a  material   diminution  in  the  Participant's   base
               compensation;

                    (b) a material  diminution  in the  Participant's  authority
               duties, or responsibilities;

                    (c) a  material  diminution  in the  authority,  duties,  or
               responsibilities  of the  supervisor to whom the  Participant  is
               required  to  report,  including  a  requirement  that a  service
               provider  report to a corporate  officer or  employee  instead of
               reporting directly to the board of directors of a corporation (or
               similar  governing  body with  respect to an entity  other than a
               corporation);

                    (d) a  material  diminution  in the  budget  over  which the
               Participant retains authority;

                    (e) a material  change in the  geographic  location at which
               the Participant must perform the services; or

                    (f) any other action or inaction that constitutes a material
               breach by the Bank of any  employment  or other  agreement  under
               which the Participant provides services to the Bank.

<PAGE>

     1.11  "Liability  Reserve  Account"  means the balance to the credit of the
Participant in a bookkeeping  account established and maintained by the Bank for
the benefit of the Participant under this Plan. Subject to the conditions in the
next sentence,  the Bank agrees to set aside each year an appropriate  amount in
the Participant's Liability Reserve Account that would achieve such the targeted
Retirement  Benefit described above on the Participant's  Normal Retirement Age,
assuming a reasonable  rate of earnings.  Notwithstanding  anything  else to the
contrary,  after taking into  consideration  the Bank's  prior year's  financial
performance  and safety and soundness  benchmarks,  the Board may determine that
the  Bank  is  unable  to  prudently  make  the  full  amount  of  the  targeted
contribution to the Participant's  Liability Reserve Account for that Plan Year,
in which case the maximum  amount that, the Board's sole  discretion,  prudently
could be contributed to the Participant's accrued Liability Reserve Account will
be made for  that  Plan  Year,  and any  shortfall  may or may not be made up in
future years. In any event,  regardless of the Participant's targeted Retirement
Benefit,  the  Participant's  unvested  Liability Reserve Account may be revised
from time to time in  consultation  with the Bank's  accountants,  benefit  plan
consultants and outside counsel.

     1.12 "Normal  Retirement Age" means the age specified on the  Participant's
Benefits Schedule as his or her Normal Retirement Age.

     1.13 "Plan Year" means the calendar year.

     1.14  "Separation  from Service" or "Separates from Service" shall have the
meaning  set  forth  in Code  Section  409A  and  Treasury  Regulations  Section
1.409A-1(h).

     1.15  "Retirement  Benefit" means the  retirement  benefit as stated in the
Participant's Benefit Schedule.

     1.16  "Unforeseeable  Emergency" means a severe  financial  hardship to the
Participant  resulting  from an  illness or  accident  of the  Participant,  the
Participant's spouse or a dependent,  loss of the 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,  all within the
meaning of Treasury Regulations Section 1.409A-3(i)(3).

                                   ARTICLE II

                             ELIGIBILITY AND VESTING
                             -----------------------

     2.1  Eligibility.  The Plan is available  to a select  group of  management
and/or highly compensated employees of the Bank, determined from time to time by
the  Committee.  Each  Participant  shall  receive  a copy  of this  Plan  and a
personalized Benefits Schedule at the time he or she joins the Plan.

     2.2 Vesting.  Each Participant shall become 20% vested in his Plan benefits
as of each annual  anniversary date of his participation in the Plan, such that,
after five years of  participation  in the Plan, the  Participant  shall be 100%
vested. Each Participant's  personalized  vesting schedule shall be set forth on
the Participant's  Benefits Schedule at the time the Participant joins the Plan.
Notwithstanding the preceding, Participants shall become fully vested upon death
or Disability.


<PAGE>



                                   ARTICLE III

                                     FUNDING
                                     -------

     3.1 Type of Plan. The Plan is a nonqualified  deferred  compensation  plan,
where the Bank  accrues  amounts  annually  in order to fund a future  stream of
payments for each  Participant.  The benefits  provided  under this Plan are not
based on any salary reduction by the Participants.  Participants do not have the
option  of  receiving  any  current  payment  or bonus  in lieu of the  benefits
provided under this Plan.

     3.2 Funding.

     (a) The Bank  shall  account  for the Plan  benefits  using the  regulatory
accounting  principles of the Bank's primary federal  regulator.  The Bank shall
establish  an  accrued  liability  reserve  account  for  the  benefit  of  each
Participant into which appropriate reserves shall be accrued for the Participant
until the Participant has attained Normal Retirement Age.

     (b)  Notwithstanding  the  preceding   sentence,   each  Participant,   his
Beneficiaries  or any  successor in interest to him shall be and remain simply a
general  creditor of the Bank in the same manner as any other creditor  having a
general claim for unpaid compensation.  Each Participant, his Beneficiaries,  or
any other  person  claiming  through  Participant,  shall only have the right to
receive  from the Bank those  payments as  specified  under this Plan.  The Bank
reserves  the  absolute  right,  at its  sole  discretion,  to  either  fund the
obligations  undertaken  by this Plan or to refrain from funding the same and to
determine the extent,  nature,  and method of such informal funding.  Should the
Bank elect to fund this Plan, in whole or in part,  through the purchase of life
insurance  products,   the  Bank  reserves  the  absolute  right,  in  its  sole
discretion, to terminate such funding at any time, in whole or in part.

     (c) At no time shall any  Participant be deemed to have any lien nor right,
title or interest in or to any specific  funding  investment or to any assets of
the  Bank.  Any  asset  used or  acquired  by the  Bank in  connection  with the
liabilities  it has assumed under this Plan shall not be deemed to be held under
any trust for the benefit of Participant or his  Beneficiaries,  nor shall it be
considered security for the performance of the obligations of the Bank. It shall
be, and remain, a general,  unpledged,  and  unrestricted  asset of the Bank. No
Participant nor any Beneficiary under this Plan shall have any power or right to
transfer,  assign,  anticipate,   hypothecate,   mortgage,  commute,  modify  or
otherwise encumber in advance any of the benefits payable  hereunder,  nor shall
any of said  benefits  be  subject  to  seizure  for the  payment  of any debts,
judgments,   alimony  or  separate   maintenance  owed  by  Participant  or  his
Beneficiary, nor be transferable by operation of law in the event of bankruptcy,
insolvency or otherwise.  In the event  Participant or any Beneficiary  attempts
assignment,  communication,  hypothecation, transfer or disposal of the benefits
hereunder, the Bank's liabilities shall forthwith cease and terminate.


<PAGE>




                                   ARTICLE IV

                                    BENEFITS
                                    --------


     4.1 Normal Retirement Benefit. Unless the Participant specifies a different
time or form of payment on his Benefits Schedule, upon Participant's  Separation
from Service on or after his Normal  Retirement Age, the Bank shall begin paying
the Participant's  Retirement  Benefit in monthly  installments  starting on the
first day of the second calendar month  immediately  following the Participant's
Separation from Service and continuing for the Participant's lifetime; provided,
however,  that in the event the  Participant  dies before  receiving 180 monthly
installments  (i.e.,  15 years of Retirement  Benefits),  the Bank shall pay the
present value of the remainder of such payments to the Participant's Beneficiary
as a lump sum no later than the first day of the second calendar month following
the  Participant's  date of death. The IRS's  then-current  "applicable  federal
rate"  shall  be used for  purposes  of  determining  the  present  value of the
remaining payments.  Notwithstanding the foregoing, in the event the Participant
is a "Specified Employee" (as defined in Code Section 409A), then, to the extent
necessary to avoid  penalties  under Code Section 409A, no payment shall be made
to the  Participant  prior to the first day of the seventh  month  following the
Participant's Separation from Service.

     4.2  Disability.  If a Participant  becomes  Disabled  before  reaching his
Normal  Retirement Age, the Participant  shall be entitled to a lump sum payment
of the vested accrued balance of the  Participant's  Liability  Reserve Account,
determined as of the date the Participant became Disabled. Such payment shall be
made no later than the first day of the second calendar month after the date the
Participant became Disabled.

     4.3 Death  Before  Normal  Retirement  Age.  If a  Participant  dies before
reaching his Normal  Retirement Age, the  Participant's  Beneficiaries  shall be
entitled  to a lump sum  payment  equal to one  times the  Participant's  Annual
Compensation.  Such  payment  shall be made no later  than the  first day of the
second calendar month after the date the Participant died.

     4.4 Voluntary  Separation from Service Before Normal Retirement Age. In the
event of the  Participant's  Separation from Service prior to Normal  Retirement
Age for reasons  other than death,  Disability,  Separation  from Service due to
Cause, or Involuntary Separation from Service (as described in Section 4.5), the
Participant  shall be paid  the  vested  accrued  balance  of the  Participant's
Liability  Reserve  Account  in a lump sum no later  than the  first  day of the
second  calendar month following the date of the  Participant's  Separation from
Service.  Notwithstanding  the  foregoing,  in the  event the  Participant  is a
"Specified  Employee"  (as defined in Code Section  409A),  then,  to the extent
necessary to avoid  penalties  under Code Section 409A, no payment shall be made
to the  Participant  prior to the first day of the seventh  month  following the
Participant's  Separation  from  Service.  If the  Participant's  employment  is
terminated  for Cause,  the  Participant  shall forfeit all benefits  under this
Plan.

<PAGE>

     4.5  Involuntary   Separation  from  Service.   If  (i)  the  Participant's
employment  is  involuntarily  terminated  (other  than for  Cause)  or (ii) the
Participant terminates employment for Good Reason, the Participant's  Retirement
Benefit as set forth on his Benefit  Schedule  shall be paid to the  Participant
upon his Separation from Service in the same manner as set forth in Section 4.1.
Notwithstanding  the  foregoing,  in the event the  Participant  is a "Specified
Employee" (as defined in Code Section  409A),  then, to the extent  necessary to
avoid  penalties  under  Code  Section  409A,  no  payment  shall be made to the
Participant  prior  to  the  first  day  of  the  seventh  month  following  the
Participant's Separation from Service.

     4.6  Adjustment  for Change in  Control.  In the event  that the  aggregate
payments or benefits to be made or afforded to the Participant in the event of a
Change in Control would be deemed to include an "excess parachute payment" under
Code Section 280G or any successor thereto, then at the election of Participant,
(i) such payments or benefits shall be payable or provided to  Participant  over
the minimum  period  necessary to reduce the present  value of such  payments or
benefits  to an  amount  that  is one  dollar  ($1.00)  less  than  three  times
Participant's  "base  amount"  under Code Section  280G, or (ii) the payments or
benefits to be provided under this Plan shall be reduced to the extent necessary
to avoid treatment as an excess  parachute  payment,  with the allocation of the
reduction among such payments and benefits to be determined by Participant.

     4.7 Unforeseeable  Emergency.  A Participant may apply to the Committee for
an Unforeseeable  Emergency  distribution.  Such  distribution  shall be paid no
later than 90 days  after the  Committee  determines  that the  Participant  has
suffered an Unforeseeable  Emergency.  The amount of the  distribution  shall be
limited to an amount that is reasonably  necessary to satisfy the  Participant's
Unforeseeable Emergency, including payment of any taxes that are owed due to the
distribution.  A  distribution  may not be paid under this Section to the extent
the Unforeseeable Emergency is or may be relieved:

     (a) through reimbursement or compensation by insurance, or otherwise;

     (b) by liquidation of Participant's  assets, to the extent such liquidation
would not in itself cause financial hardship; or

     (c) by  cessation  of  elective  deferrals  under the Bank's  tax-qualified
retirement plans.


                                    ARTICLE V

                                 ADMINISTRATION
                                 --------------

     5.1 Committee. The Committee shall be the named fiduciary and administrator
of this Plan. As  administrator,  the  Committee  shall be  responsible  for the
management,  control and  administration of the Plan as established  herein. The
Committee  may  delegate  to  others  certain  aspects  of  the  management  and
operational  responsibilities of the Plan,  including the employment of advisors
and the delegation of ministerial duties to qualified individuals.

<PAGE>

     5.2 Claims  Procedure.  In the event that benefits  under this Plan are not
paid to Participant (or to his Beneficiary in the case of  Participant's  death)
and such  claimants  feel they are  entitled to receive  such  benefits,  then a
written  claim  must be made to the  Committee  within  60 days  from  the  date
payments are refused.  The Committee  shall review the written claim and, if the
claim is denied,  in whole or in part,  they shall provide in writing  within 60
days of receipt of such claim their specific reasons for such denial,  reference
to the provisions of this Plan upon which the denial is based and any additional
material or  information  necessary to perfect the claim.  Such  written  notice
shall  further  indicate  the  additional  steps to be taken by  claimants  if a
further review of the claim denial is desired.

     5.3 Appeal.  If  claimants  desire a second  review,  they shall notify the
Committee in writing  within 60 days of the first claim  denial.  Claimants  may
review the Plan or any  documents  relating  thereto and submit any  issues,  in
writing,  and comments they may feel  appropriate.  In its sole discretion,  the
Committee  shall then  review the second  claim and  provide a written  decision
within sixty (60) days of receipt of such claim.  This decision  shall  likewise
state the  specific  reasons for the  decision  and shall  include  reference to
specific provisions of the Plan upon which the decision is based.

     5.4 Arbitration.  If claimants continue to dispute the benefit denial based
upon  completed  performance  of the Plan or the meaning and effect of the terms
and  conditions  thereof,  then  claimants  may submit the dispute to mediation,
administered  by the  American  Arbitration  Association  ("AAA") (or a mediator
selected  by the  parties) in  accordance  with the AAA's  Commercial  Mediation
Rules.  If mediation is not  successful  in resolving  the dispute,  it shall be
settled by arbitration  administered by the AAA under its Commercial Arbitration
Rules, and judgment on the award rendered by the arbitrator(s) may be entered in
any  court  having  jurisdiction  thereof.  If it  is  finally  determined  that
Participant  (or his  Beneficiary)  is entitled to the  benefits set forth under
this Plan,  then all amounts that  Participant (or his  Beneficiary)  would have
received up to the time of such final determination shall be paid to Participant
(or his Beneficiary) with reasonable interest within thirty (30) days after such
final determination.


                                   ARTICLE VI

                            AMENDMENT OR TERMINATION
                            ------------------------

     6.1 Amendment.  The Bank reserves the right to amend this Plan at any time.
However,  to the extent any such amendment  would  adversely  impact the accrued
benefits of any Participant,  the amendment shall require the written consent of
such Participant, even if the Participant is no longer employed by the Bank.

     6.2  Termination.  The Bank reserves the right to terminate the Plan at any
time. Upon Plan termination,  the Committee shall determine whether all payments
of benefits shall be made in accordance  with the normal  distribution  schedule
set forth under the Plan or if payment of benefits shall be accelerated in order
to wind down the Plan. To the extent any benefits  under the Plan are subject to
Code Section 409A, any  acceleration of the payment of such benefits due to Plan
termination shall comply with the following:

<PAGE>

               (a)  all  arrangements  sponsored  by  the  Bank  that  would  be
          aggregated   with  this  Plan  under  Treasury   Regulations   Section
          1.409A-1(c)(2)  if any  Participant  covered  by this  Plan  was  also
          covered by any of those other arrangements are also terminated;

               (b) no payments  other than  payments that would be payable under
          the terms of the  arrangement if the  termination had not occurred are
          made within 12 months of the termination of the arrangement;

               (c) all payments are made within 24 months of the  termination of
          the arrangements; and

               (d) the  Bank  does not  adopt a new  arrangement  that  would be
          aggregated with any terminated  arrangement under Treasury Regulations
          Section  1.409A-1(c)(2)  if the same Participant  participated in both
          arrangements,  at any time within  three years  following  the date of
          termination of the arrangement.


                                   ARTICLE VII

                                  MISCELLANEOUS
                                  -------------

     7.1 No Effect on Employment  Rights.  Nothing contained herein shall confer
upon any  Participant  the right to be  retained  in the service of the Bank nor
limit the right of the Bank to  discharge  or  otherwise  deal with  Participant
without regard to the existence of this Plan.

     7.2 Governing  Law. The Plan is  established  under,  and will be construed
according  to, the laws of the State of New York,  to the extent  that such laws
are not preempted by ERISA.

     7.3  Severability.  In the event that any provision of this Plan is held to
be  inoperative  or invalid by any court of competent  jurisdiction,  then:  (1)
insofar as is reasonable,  effect will be given to the intent manifested in such
provision,  and (2) the validity and enforceability of the remaining  provisions
will not be affected thereby.

     7.4  Establishment  of Rabbi Trust.  The Bank may, but is not obligated to,
establish a rabbi trust into which the Bank may contribute assets which shall be
held therein,  subject to the claims of the Bank's creditors in the event of the
Bank's  insolvency,  until the contributed  assets are paid to Participants  and
their Beneficiaries in such manner and at such times as specified in this Plan.

     7.5 Tax  Withholding.  The Bank may withhold from any benefit payable under
this Plan all federal,  state, city, income,  employment or other taxes as shall
be required pursuant to any law or governmental regulation then in effect.

     7.6 Entire Agreement.  This Plan sets forth the entire understanding of the
parties hereto with respect to the  transactions  contemplated  hereby,  and any
previous  Plans or  understandings  between the  parties  hereto  regarding  the
subject matter hereof are merged into and superseded by this Plan.

<PAGE>

     IN WITNESS WHEREOF, the Bank has caused this Plan to be executed on the day
and date first above written.

                                         BEACON FEDERAL




December 27, 2007                    By: /s/ Timothy P. Ahern
-----------------                        ---------------------------------------
Date                                     Timothy P. Ahern, Chairman of the Board