EXHIBIT 10.5
         Supplemental Retirement Agreement between NBT Bancorp Inc., NBT
          Bank, National Association and Martin A. Dietrich made as of
                                 January 1, 2000

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                        SUPPLEMENTAL RETIREMENT AGREEMENT


         This  sets  forth  the  terms  of  an  agreement  for  the  payment  of
supplemental  retirement income ("Agreement") made as of January 1, 2000 between
(i) NBT BANCORP  INC.,  a Delaware  corporation  and a  registered  bank holding
company,  and NBT BANK,  NATIONAL  ASSOCIATION,  a national banking  association
chartered  under the laws of the United States,  both having offices  located at
Norwich, New York (collectively,  the "Bank"),  and (ii) MARTIN A. DIETRICH,  an
individual residing at 155 Serenity Drive, Norwich, New York 13815, and who is a
member of a select group of management or highly  compensated  employees  within
the meaning of section 201(2) of the Employee  Retirement Income Security Act of
1974, as amended ("Dietrich").

         1.       PURPOSE OF THE AGREEMENT.  The purpose of this Agreement is to
provide Dietrich a supplemental  retirement benefit in accordance with the terms
of this Agreement.

         2.       DEFINITIONS.  For purposes of this Agreement, the following
words shall have the meaning indicated:

                  (a)      ACTUARIAL  EQUIVALENT.  "Actuarial  Equivalent" shall
have the same meaning the term "Actuarial  Equivalent" has under Section 2.03 of
the Qualified Plan using the following actuarial assumptions:

                           MORTALITY:      "Applicable  Mortality  Rate" as such
term is  defined  in  Section  2.03c of the Qualified Plan.

                           INTEREST RATE:  "Applicable Interest Rate" as such
term is defined in Section 2.09b of the Qualified Plan.

                  (b) BENEFICIARY.  "Beneficiary"  shall mean such living person
         or  living   persons   designated  by  Dietrich  in   accordance   with
         subparagraph  5(a) to receive  benefits under this Agreement  after his
         death, or his personal or legal representative, all as herein described
         and  provided.  If no  Beneficiary  is  designated by Dietrich or if no
         Beneficiary  survives  Dietrich,  the  Beneficiary  shall be Dietrich's
         estate.

                  (c)      CAUSE.  "Cause" shall mean Dietrich's:

                           (i) willful or gross  misconduct  with respect to the
                  business  and affairs of the Bank,  or with  respect to any of
                  its  affiliates  for  which  Dietrich  is  assigned   material
                  responsibilities or duties;

                           (ii) conviction of a felony (after the earlier of the
                  expiration of any applicable appeal period without  perfection
                  of an appeal by  Dietrich  or the  denial of any  appeal as to
                  which no further  appeal or review is  available  to Dietrich)
                  whether or not  committed in the course of his  employment  by
                  the Bank;

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                           (iii) willful neglect,  failure,  or refusal to carry
                  out his duties  under the  Employment  Agreement  between  NBT
                  Bancorp  Inc.  and  Dietrich  dated as of January 1, 2000 (the
                  "Employment Agreement") in a reasonable manner (other than any
                  such  failure  resulting  from  disability  or  death  or from
                  termination  by Dietrich  for Good  Reason,  as defined in the
                  Employment  Agreement)  after a written demand for substantial
                  performance   is  delivered  to  Dietrich  that   specifically
                  identifies the manner in which the Bank believes that Dietrich
                  has not  substantially  performed  his  duties  and he has not
                  resumed substantial  performance of his duties on a continuous
                  basis within thirty days of receiving such demand; or

                           (iv)  breach of any  representation  or  warranty  in
                  section 6(a) of the  Employment  Agreement or of any agreement
                  contained  in  section  1, 4,  5,  or  6(b) of the  Employment
                  Agreement, which breach is material and adverse to the Bank or
                  any of its affiliates for which Dietrich is assigned  material
                  responsibilities or duties.

                  (d) CHANGE OF CONTROL. "Change of Control" shall mean a Change
         in Control  as such term is defined in the Change in Control  Agreement
         between  Dietrich and the Bank dated January 1, 2000 (a revision of the
         October 27, 1998 and January 2, 1997 agreements).

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

                  (f) DETERMINATION  DATE.  "Determination  Date"  shall
mean  the  earlier  of (i) the  date of  termination  of Dietrich's employment
with the Bank or (ii) the first day of the month following Dietrich's 65th
birthday.

                  (g) FINAL AVERAGE  COMPENSATION.  "Final Average Compensation"
         shall have the same meaning the term "Final Average  Compensation"  has
         under Section 2.27 of the Qualified  Plan,  except that in  determining
         the amount of Compensation (as defined in Section 2.14 of the Qualified
         Plan)  to be used  in  calculating  Final  Average  Compensation  under
         Section 2.27 of the Qualified Plan,  Compensation  shall not be subject
         to the compensation limitation of section 401(a)(17) of the Code.

                  (h) FULL-TIME  EMPLOYEE.  "Full-Time  Employee"  shall
mean an employee who works not less than 1,000 hours in a calendar year.

                  (i) OTHER RETIREMENT BENEFITS.  "Other Retirement Benefits"
shall mean the sum of:

                           (i)  The annual benefit payable to Dietrich from the
Qualified Plan, plus

                           (ii) The annual benefit that could be provided by (A)
                  Bank  contributions  (other than elective  deferrals)  made on
                  Dietrich's  behalf  under  the NBT  Bancorp  Inc.  401(k)  and


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                  Employee  Stock  Ownership  Plan,  and (B) actual  earnings on
                  contributions in (A), if such  contributions and earnings were
                  converted to a benefit  payable on the  Determination  Date in
                  the same form as the benefit paid under this Agreement,  using
                  the  same   actuarial   assumptions   as  are  provided  under
                  subparagraph 2(a).

                  The amount of Other Retirement Benefits shall be determined by
         an actuary  selected by the Bank,  with such  determination  to be made
         without  reduction for payment of benefits  prior to any stated "normal
         retirement  date" and without  regard to whether  Dietrich is receiving
         payment  of such  benefits  on the  Determination  Date.  To the extent
         Dietrich receives a payment of Other Retirement  Benefits  described in
         subparagraph  2(i)(ii)  prior to the date the  Supplemental  Retirement
         Benefit is  determined  pursuant to this  Agreement,  the total of such
         Other Retirement Benefits shall be determined by including and assuming
         that such  amounts  earned  interest  at a  variable  rate equal to the
         one-year  United States  Treasury bill rate as reported in the New York
         edition of The Wall Street Journal on the  Determination  Date from the
         date received to the date Other Retirement  Benefits are calculated for
         purposes of this Agreement.

                  (j)      PRESENT  VALUE.  "Present  Value" shall mean the
present  value of a benefit  determined on the basis of the following actuarial
assumptions:

                           MORTALITY:       "Applicable  Mortality  Rate" as
such  term is  defined  in  Section  2.03c of the Qualified Plan.

                           INTEREST RATE:   "Applicable Interest Rate" as such
term is defined in Section 2.09b of the Qualified Plan.

                  (k)      QUALIFIED PLAN.  "Qualified Plan" shall mean the NBT
BANCORP Inc. Defined Benefit Pension Plan.

                  (l)      SOCIAL SECURITY  BENEFIT.  "Social Security Benefit"
shall mean Dietrich's actual social security benefit at his Social Security
Retirement Age.

                  (m)      SOCIAL  SECURITY  RETIREMENT  AGE.  "Social  Security
Retirement Age" shall have the same meaning the term "Social Security Retirement
Age" has under Section 2.58 of the Qualified Plan.

                  (n)      YEAR OF SERVICE.  "Year of Service"  shall mean a
calendar  year in which  Dietrich  completes not less than 1,000 hours of
service.

         3.       AMOUNT OF SUPPLEMENTAL RETIREMENT BENEFIT.

                  (a)  AMOUNT  PAYABLE  ON AND AFTER AGE 62. If  Dietrich  shall
         remain  employed by the Bank until reaching his 62nd birthday,  serving

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         as a Full-Time Employee until such date, and subject to the other terms
         and conditions of this Agreement, the Bank shall pay Dietrich an annual
         "Supplemental Retirement Benefit" determined as follows:

                           (i) ON AND AFTER AGE 62 BUT  BEFORE  SOCIAL  SECURITY
                  RETIREMENT  AGE.  Dietrich shall be entitled to a Supplemental
                  Retirement  Benefit on and after his 62nd  birthday but before
                  his Social  Security  Retirement Age in an amount equal to the
                  excess  of  (1)  50  percent  of   Dietrich's   Final  Average
                  Compensation,  over (2) Dietrich's Other Retirement  Benefits,
                  determined  as of the  Determination  Date and  calculated  in
                  accordance with paragraph 2(i).

                           (ii) ON AND AFTER  SOCIAL  SECURITY  RETIREMENT  AGE.
                  Dietrich  shall  be  entitled  to  a  Supplemental  Retirement
                  Benefit on and after his Social Security  Retirement Age in an
                  amount  equal to the excess of (1) 50  percent  of  Dietrich's
                  Final  Average   Compensation,   over  (2)  the  sum  of  (aa)
                  Dietrich's  Other  Retirement  Benefits,  determined as of the
                  Determination Date and calculated in accordance with paragraph
                  2(i), plus (bb) Dietrich's Social Security Benefit.

                  (b)  AMOUNT  PAYABLE ON AND AFTER AGE 60 BUT BEFORE AGE 62. If
         Dietrich  shall  remain  employed by the Bank until  reaching  his 60th
         birthday,  serving  as a  Full-Time  Employee  until  such  date and he
         continues  to  serve  as a  Full-Time  Employee  until  the date of his
         retirement,  and he retires then or thereafter but before  reaching his
         62nd  birthday,  and subject to the other terms and  conditions of this
         Agreement,  the Bank shall pay Dietrich on the date of his  retirement,
         pursuant to subparagraph  4(b), or to his spouse or other  Beneficiary,
         pursuant  and  subject to  subparagraph  6(c) if he has died before his
         62nd  birthday,   a  reduced  early  Supplemental   Retirement  Benefit
         calculated in accordance with the following schedule:

                           (i) If the date of Dietrich's  retirement shall be on
                  or after his 60th birthday but before his 61st  birthday,  the
                  Bank shall pay  Dietrich  60% of the  Supplemental  Retirement
                  Benefit  calculated in accordance with  subparagraph  3(a)(i);
                  and

                           (ii) If the date of Dietrich's retirement shall be on
                  or after his 61st birthday but before his 62nd  birthday,  the
                  Bank shall pay  Dietrich  70% of the  Supplemental  Retirement
                  Benefit so calculated.

         4.       TIME OF PAYMENT.

                  (a) Except as provided in subparagraph 4(b) (early retirement)
         and paragraph 6 (payment on death), the Bank shall pay the Supplemental
         Retirement  Benefit  commencing on the first day of the month following
         Dietrich's attainment of age 62.

                  (b) Notwithstanding subparagraph 4(a), the Bank shall commence
         payment  of an early  Supplemental  Retirement  Benefit,  in the amount
         determined  under  subparagraph  3(b),  on the  first  day of the month

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         following  Dietrich's  Determination  Date  in  connection  with  early
         retirement  after  reaching  age 60 and  prior  to the date of his 62nd
         birthday.

         5.       FORM OF PAYMENT.

                  (a) The Supplemental Retirement Benefit described in paragraph
         3 of this Agreement  shall be paid as a straight life annuity,  payable
         in monthly installments,  for Dietrich's life; provided,  however, that
         if Dietrich has no surviving  spouse and dies before having received 60
         monthly  payments,  such  monthly  payments  shall be  continued to his
         Beneficiary  until the total number of monthly payments to Dietrich and
         his  Beneficiary  equal 60,  whereupon all payments shall cease and the
         Bank's  obligation  under this  Agreement  shall be deemed to have been
         fully  discharged.  If Dietrich  and his  Beneficiary  shall die before
         having received a total of 60 monthly payments,  an amount equal to the
         Actuarial  Equivalent of the balance of such monthly  payments shall be
         paid in a single sum to the estate of the  survivor of Dietrich and his
         Beneficiary.  If  Supplemental  Retirement  Benefits are payable in the
         form described in this subparagraph  5(a),  Dietrich shall designate in
         writing,  as  his  Beneficiary,   any  person  or  persons,  primarily,
         contingently  or  successively,  to whom the Bank  shall  pay  benefits
         following Dietrich's death if Dietrich's death occurs before 60 monthly
         payments have been made.

                  (b)   Notwithstanding   the  form  of  payment   described  in
         subparagraph  5(a),  if Dietrich is married on the date  payment of the
         Supplemental Retirement Benefit commences, the benefit shall be paid as
         a 50%  joint  and  survivor  annuity  with  Dietrich's  spouse  as  the
         Beneficiary.  The 50% joint and survivor annuity shall be the Actuarial
         Equivalent  of the  benefit  described  in  subparagraph  5(a).  If the
         Supplemental   Retirement   Benefit   is  payable   pursuant   to  this
         subparagraph  5(b),  but  Dietrich's  spouse  fails to survive  him, no
         payments will be made pursuant to this Agreement  following  Dietrich's
         death.

                  (c) Notwithstanding the foregoing provisions of this paragraph
         5, the Bank, in its sole discretion,  may accelerate the payment of all
         or any portion of the  Supplemental  Retirement  Benefit or the reduced
         early  Supplemental   Retirement  Benefit  at  any  time.  Any  payment
         accelerated  in  accordance  with this  subparagraph  5(c) shall be the
         Actuarial Equivalent of the payment being accelerated.

         6.       PAYMENTS UPON DIETRICH'S DEATH.

                  (a)  Except as  provided  in  subparagraphs  6(b) and (c),  if
         Dietrich  shall die before his 62nd  birthday,  no payment shall be due
         his estate under this Agreement.

                  (b) If  Dietrich's  death  shall  occur on or  after  his 60th
         birthday,  after he has retired but before payment of any  Supplemental
         Retirement Benefit has commenced,  Dietrich's surviving spouse shall be

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         paid  as a  straight  life  annuity  50  percent  of  the  Supplemental
         Retirement  Benefit for her life  commencing  within 30 days  following
         Dietrich's death. Such payments shall be made in monthly  installments,
         subject to the right of the Bank to  accelerate  payment at any time in
         accordance with subparagraph 5(c).

                  (c)  If  Dietrich   elects   early   retirement   pursuant  to
         subparagraph  3(b)  and he  dies  before  payment  of any  Supplemental
         Retirement Benefit has commenced,  Dietrich's surviving spouse shall be
         paid, in monthly  installments,  as a straight life annuity, 50 percent
         of such Supplemental  Retirement Benefit for her life commencing within
         30 days following Dietrich's death, subject to the right of the Bank to
         accelerate such payments as provided in subparagraph 5(c).  However, if
         Dietrich's  spouse  fails  to  survive  him,  the  Bank  shall  pay  to
         Dietrich's estate a lump sum benefit equal to 50 percent of the Present
         Value of Dietrich's Supplemental Retirement Benefit.

                  (d) Except as  otherwise  provided in  subparagraph  6(c),  no
         payments  shall be made under this  Agreement  if Dietrich  dies before
         payment of any  Supplemental  Retirement  Benefit begins and his spouse
         fails to survive him.

                  (e)  If  Dietrich's  death  shall  occur  after  payment  of a
         Supplemental  Retirement  Benefit  has  commenced,  Dietrich  surviving
         spouse  or  other  Beneficiaries  shall  receive  payments  under  this
         Agreement to the extent provided in paragraph 5.

         7.  FORFEITURE FOR CAUSE.  Notwithstanding any other provision of
this Agreement,  if Dietrich's employment with the Bank is terminated for Cause,
Dietrich and his spouse or other Beneficiaries shall forfeit all rights to any
payment under this Agreement.

         8.  POWERS.  The Bank shall  have such  powers as may be  necessary  to
discharge its duties under this Agreement,  including the power to interpret and
construe this  Agreement and to determine  all questions  regarding  employment,
disability status, service,  earnings,  income and such factual matters as birth
and marital status. The Bank's determinations  hereunder shall be conclusive and
binding  upon the  parties  hereto and all other  persons  having or claiming an
interest under this Agreement.  The Bank shall have no power to add to, subtract
from, or modify any of the terms of this  Agreement.  The Bank's  determinations
hereunder  shall be entitled to  deference  upon review by any court,  agency or
other entity  empowered to review its decisions,  and shall not be overturned or
set aside by any court,  agency or other entity  unless  found to be  arbitrary,
capricious or contrary to law.

         9.  CLAIMS PROCEDURE.

                  (a) Any claim for  benefits by  Dietrich,  his spouse or other
         Beneficiaries  shall be made in writing to the Bank. In this paragraph,
         Dietrich and his Beneficiaries are referred to as "claimants."

                  (b) If the Bank  denies a claim in whole or in part,  it shall
         send the claimant a written  notice of the denial  within 90 days after
         the date it receives a claim,  unless it needs  additional time to make
         its decision.  In that case,  the Bank may authorize an extension of an

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         additional 90 days if it notifies the claimant of the extension  within
         the initial 90-day period. The extension notice shall state the reasons
         for the extension and the expected decision date.

                  (c)      A denial notice shall contain:

                           (i)      The specific reason or reasons for the
                  denial of the claim;

                           (ii)     Specific reference to pertinent Agreement
                  provisions upon which the denial is based;

                           (iii) A  description  of any  additional  material or
                  information   necessary   to  perfect   the  claim,   with  an
                  explanation  of why the material or  information is necessary;
                  and

                           (iv)  An explanation of the review procedures
                  provided below.

                  (d)  Within  60 days  after  the  claimant  receives  a denial
         notice, he or she may file a request for review with the Bank. Any such
         request must be made in writing.

                  (e) A claimant who timely requests review shall have the right
         to review  pertinent  documents,  to submit  additional  information or
         written comments, and to be represented.

                  (f) The Bank shall send the claimant a written decision on any
         request for review  within 60 days after the date it receives a request
         for  review,  unless an  extension  of time is  needed,  due to special
         circumstances.  In that case, the Bank may authorize an extension of an
         additional 60 days,  provided it notifies the claimant of the extension
         within the initial 60-day period.

                  (g)      The review decision shall contain:

                           (i)     The specific reason or reasons for the
                  decision; and

                           (ii)    Specific reference to the pertinent Agreement
                  provisions upon which the decision is based.

                  (h) If the Bank does not send the  claimant a review  decision
         within the applicable time period,  the claim shall be deemed denied on
         review.

                  (i) The denial notice or, in the case of a timely review,  the
         review  decision  (including a deemed denial under  subparagraph  9(h))
         shall be the Bank's final decision.


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         10. ASSIGNMENT.  Neither Dietrich nor his spouse or other Beneficiaries
may  transfer  his,  her or their right to payments to which he, she or they are
entitled  under this  Agreement.  Except insofar as may otherwise be required by
law, any Supplemental  Retirement Benefit payable under this Agreement shall not
be  subject  in any  manner  to  alienation  by  anticipation,  sale,  transfer,
assignment,  pledge or  encumbrance,  nor  subject to the debts,  contracts,  or
liabilities of Dietrich or his spouse or other Beneficiaries.

         11.      CONTINUED  EMPLOYMENT.  This  Agreement  shall not be
construed  as  conferring  on  Dietrich  a right to  continued employment with
the Bank.

         12.      FUNDING.

                  (a) The Supplemental  Retirement Benefit at all times shall be
         entirely  unfunded,  and no  provision  shall at any time be made  with
         respect  to  segregating  any  assets of the Bank for  payments  of any
         benefits  hereunder,  except  that in the event of a Change of Control,
         the Bank, within five (5) days of such Change of Control,  shall fund a
         grantor  trust  within the  meaning of section  671 of the Code with an
         amount  sufficient  to  cover  all  potential  liabilities  under  this
         Agreement.

                  (b)  Neither  Dietrich  nor his spouse or other  Beneficiaries
         shall have any interest in any particular  assets of the Bank by reason
         of the right to receive a benefit  under this  Agreement.  Dietrich and
         his spouse or other Beneficiaries shall have only the rights of general
         unsecured  creditors  of the Bank with respect to any rights under this
         Agreement.

                  (c) Nothing  contained in this  Agreement  shall  constitute a
         guarantee  by the Bank or any  entity or person  that the assets of the
         Bank will be sufficient to pay any benefit hereunder.

         13.  WITHHOLDING.  Any payment made pursuant to this Agreement shall be
reduced by federal and state income, FICA or other employee payroll, withholding
or other similar taxes the Bank may be required to withhold. In addition, as the
Supplemental  Retirement  Benefit accrues during Dietrich's  employment with the
Bank, the Bank may withhold from Dietrich's  regular  compensation from the Bank
any FICA or other employee payroll,  withholding or other similar taxes the Bank
may be required to withhold.

         14.      SUCCESSORS AND ASSIGNS.  This Agreement shall be binding upon,
and shall inure to the benefit of, the successors and assigns of the Bank.

         15.      APPLICABLE  LAW. This Agreement  shall be construed and
administered in accordance with the laws of the State of New York, except to the
extent preempted by federal law.

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         16.      AMENDMENT.  This Agreement may not be amended,  modified or
otherwise altered except by written  instrument  executed by both parties.

         17.      ENTIRE AGREEMENT.  This Agreement  constitutes the entire
agreement and understanding of the parties,  and supersedes all prior agreements
or  understanding  (whether  oral or written)  between the  parties,  relating
to deferred  compensation  and/or supplemental retirement income.

The parties hereby execute this Agreement as follows:

                              NBT BANCORP INC.

                              By: /S/ DARYL R. FORSYTHE   /S/ EVERETT A. GILMOUR
                                  ----------------------------------------------

Date:       1/1/2000          Its:    PRES & CEO              CHAIRMAN
      ---------------------       ----------------------------------------------

                              NBT BANK, NATIONAL ASSOCIATION

                              By: /S/ DARYL R. FORSYTHE

Date:      1/1/2000           Its:    CHAIRMAN & CEO
      ---------------------       --------------------------



Date:     1/1/2000                /S/ MARTIN A. DIETRICH
      ---------------------    -----------------------------
                                      MARTIN A. DIETRICH


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