Document:

EXHIBIT (10)(iii)16

                              EMPLOYMENT AGREEMENT

              AGREEMENT by and between CH Energy Group, Inc. ("Energy Group"), a
New York corporation, and Paul J. Ganci (the "Executive"), dated as of the 28th
day of September, 2001.

              The Board of Directors of Energy Group (the "Board"), has
determined that it is in the best interests of Energy Group and its shareholders
to assure that Energy Group will have the continued dedication of the Executive,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined below) of Energy Group. The Board believes it is imperative to diminish
the inevitable distraction of the Executive by virtue of the personal
uncertainties and risks created by a pending or threatened Change of Control and
to encourage the Executive's full attention and dedication to Energy Group
currently and in the event of any threatened or pending Change of Control, and
to provide the Executive with compensation and benefits arrangements upon a
Change of Control which ensure that the compensation and benefits expectations
of the Executive will be satisfied and which are competitive with those of other
corporations. Therefore, in order to accomplish these objectives, the Board has
caused Energy Group to enter into this Agreement with the Executive.

              NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

              1.     This Employment Agreement shall be between Energy Group and
the Executive named above for all periods during which the Executive serves in
the capacity as an officer of Energy Group or any of its affiliated companies.

              2.     CERTAIN DEFINITIONS. (a) As used in this Agreement, "Energy
Group" shall mean CH Energy Group, Inc. as hereinbefore defined and any
successor to its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise.

              (b)    As used in this Agreement, the term "affiliated companies"
shall include any company controlled by, controlling or under common control
with Energy Group.

              (c)    The "Effective Date" shall mean the first date during the
Change of Control Period (as defined in Section 2(d)) on which a Change of
Control (as defined in Section 3) occurs. Anything in this Agreement to the
contrary notwithstanding, if a Change of Control occurs and if the Executive's
employment with Energy Group or any of its affiliated companies is terminated
prior to the date on which the Change of Control occurs, and if it is reasonably
demonstrated by the Executive that such termination of employment (i) was at the
request of a third party who has taken steps reasonably calculated to effect a
Change of Control or (ii) otherwise arose in connection with or anticipation of
a Change of Control, then for all purposes of this

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Agreement the "Effective Date" shall mean the date immediately prior to the date
of such termination of employment.

              (d)    The "Change of Control Period" shall mean the period
commencing on the date hereof and ending on the following July 31, which July 31
and each annual anniversary thereof shall be hereinafter referred to as the
"Renewal Date". Unless previously terminated, the Change of Control Period shall
be automatically extended so as to terminate one year from such Renewal Date,
unless at least 60 days prior to the Renewal Date Energy Group shall give notice
to the Executive that the Change of Control Period shall not be so extended;
PROVIDED, that such a notice shall be null and void if it is reasonably
demonstrated by the Executive that such notice was given (i) at the request of a
third party who has taken steps reasonably calculated to effect a Change of
Control or (ii) otherwise in connection with or anticipation of a Change of
Control.

              (e)    The "Multiple" shall mean three.

              3.     CHANGE OF CONTROL. For the purpose of this Agreement, a
"Change of Control" shall mean:

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

              (b)    Individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by Energy Group's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

              (c)    Consummation of a reorganization, merger or consolidation
or sale or other disposition of all or substantially all of the assets of Energy
Group (a "Business Combination"), in each case, unless, following such Business
Combination, (i) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding En-

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ergy Group Common Stock and Outstanding Energy Group Voting Securities
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 60% of, respectively, the then outstanding shares of
common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from such Business Combination (including,
without limitation, a corporation which as a result of such transaction owns
Energy Group or all or substantially all of Energy Group's assets either
directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Business Combination
of the Outstanding Energy Group Common Stock and Outstanding Energy Group Voting
Securities, as the case may be, (ii) no Person (excluding any corporation
resulting from such Business Combination or any employee benefit plan (or
related trust) of Energy Group or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of common stock of the corporation
resulting from such Business Combination or the combined voting power of the
then outstanding voting securities of such corporation except to the extent that
such ownership existed prior to the Business Combination and (iii) at least a
majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or

              (d)    Approval by the shareholders of Energy Group of a complete
liquidation or dissolution of Energy Group.

              4.     EMPLOYMENT PERIOD. Energy Group hereby agrees to continue,
or cause to be continued, the Executive in the employ, and the Executive hereby
agrees to remain in the employ, of Energy Group or any of its affiliated
companies subject to the terms and conditions of this Agreement, for the period
commencing on the Effective Date and ending on the third anniversary of such
date (the "Employment Period").

              5.     TERMS OF EMPLOYMENT. (a) POSITION AND DUTIES. (i) During
the Employment Period, (A) the Executive's position (including status, offices,
titles and reporting requirements), authority, duties and responsibilities shall
be at least commensurate in all material respects with the most significant of
those held, exercised and assigned at any time during the 120-day period
immediately preceding the Effective Date and (B) the Executive's services shall
be performed at the location where the Executive was employed immediately
preceding the Effective Date or any office or location within Energy Group's
service territory (as it existed immediately before the Effective Date);
PROVIDED, that the Executive may be required to relocate outside such service
territory if Energy Group or any of its affiliated companies provides the
Executive with relocation benefits at least as favorable as those that would
have been provided under Energy Group's or any affiliated companies' applicable
relocation policy as in effect immediately before the Effective Date.

              (ii)   During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled, the Executive agrees
to devote reasonable attention and time during normal business hours to the
business and affairs of Energy Group and its affiliated companies and, to the
extent necessary to discharge the responsibilities assigned to

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the Executive hereunder, to use the Executive's reasonable best efforts to
perform faithfully and efficiently such responsibilities. During the Employment
Period it shall not be a violation of this Agreement for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B) deliver
lectures, fulfill speaking engagements or teach at educational institutions and
(C) manage personal investments, so long as such activities do not significantly
interfere with the performance of the Executive's responsibilities as an
employee of Energy Group or any of its affiliated companies in accordance with
this Agreement. It is expressly understood and agreed that to the extent that
any such activities have been conducted by the Executive prior to the Effective
Date, the continued conduct of such activities (or the conduct of activities
similar in nature and scope thereto) subsequent to the Effective Date shall not
thereafter be deemed to interfere with the performance of the Executive's
responsibilities to Energy Group and its affiliated companies.

              (b)    COMPENSATION. (i) BASE SALARY. During the Employment
Period, the Executive shall receive an annual base salary ("Annual Base
Salary"), which shall be paid at a monthly rate, at least equal to twelve times
the highest monthly base salary paid or payable, including any base salary which
has been earned but deferred, to the Executive by Energy Group and its
affiliated companies in respect of the twelve-month period immediately preceding
the month in which the Effective Date occurs. During the Employment Period, the
Annual Base Salary shall be reviewed no more than 12 months after the last
salary increase awarded to the Executive prior to the Effective Date and
thereafter at least annually. Any increase in Annual Base Salary shall not serve
to limit or reduce any other obligation to the Executive under this Agreement.
Annual Base Salary shall not be reduced after any such increase and the term
Annual Base Salary as used in this Agreement shall refer to Annual Base Salary
as so increased.

              (ii)   ANNUAL BONUS. In addition to Annual Base Salary, the
Executive shall be awarded, for each fiscal year ending during the Employment
Period, an annual bonus (the "Annual Bonus") in cash at least equal to the
Executive's highest bonus under Energy Group's Executive Annual Incentive Plan,
or Energy Group's Executive Compensation Program, as applicable, or any
comparable annual bonus under any predecessor or successor plan, for the last
three full fiscal years prior to the Effective Date (the "Recent Annual Bonus").
Each such Annual Bonus shall be paid no later than the end of the third month of
the fiscal year next following the fiscal year for which the Annual Bonus is
awarded.

              (iii)  INCENTIVE, SAVINGS AND RETIREMENT PLANS. During the
Employment Period, the Executive shall be entitled to participate in all
incentive, savings and retirement plans, practices, policies and programs
applicable generally to other peer executives of Energy Group or its affiliated
companies and its affiliated companies, but in no event shall such plans,
practices, policies and programs provide the Executive with incentive
opportunities (measured with respect to both regular and special incentive
opportunities, to the extent, if any, that such distinction is applicable),
savings opportunities and retirement benefit opportunities, in each case, less
favorable, in the aggregate, than the most favorable of those provided by Energy
Group and its affiliated companies for the Executive under such plans,
practices, policies and programs as in effect at any time during the 120-day
period immediately preceding the Effective Date or if more favorable to the
Executive, those provided generally at any time after the Effective Date to
other peer executives of Energy Group or any of its affiliated companies.

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              (iv)   WELFARE BENEFIT PLANS. During the Employment Period, the
Executive and/or the Executive's family, as the case may be, shall be eligible
for participation in and shall receive all benefits under welfare benefit plans,
practices, policies and programs provided by Energy Group or its affiliated
companies (including, without limitation, medical, prescription, dental,
disability, employee life, group life, accidental death and travel accident
insurance plans and programs) to the extent applicable generally to other peer
executives of Energy Group or its affiliated companies, but in no event shall
such plans, practices, policies and programs provide the Executive with benefits
which are less favorable, in the aggregate, than the most favorable of such
plans, practices, policies and programs in effect for the Executive at any time
during the 120-day period immediately preceding the Effective Date or, if more
favorable to the Executive, those provided generally at any time after the
Effective Date to other peer executives of Energy Group or any of its affiliated
companies.

              (v)    EXPENSES. During the Employment Period, the Executive shall
be entitled to receive prompt reimbursement for all reasonable expenses incurred
by the Executive in accordance with the most favorable policies, practices and
procedures of Energy Group or any of its affiliated companies in effect for the
Executive at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in effect generally at
any time thereafter with respect to other peer executives of Energy Group or any
of its affiliated companies.

              (vi)   FRINGE BENEFITS. During the Employment Period, the
Executive shall be entitled to fringe benefits, including, without limitation,
use of an automobile and payment of related expenses, in accordance with the
most favorable plans, practices, programs and policies of Energy Group or any of
its affiliated companies in effect for the Executive at any time during the
120-day period immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect generally at any time thereafter with respect to
other peer executives of Energy Group or any of its affiliated companies.

              (vii)  OFFICE AND SUPPORT STAFF. During the Employment Period, the
Executive shall be entitled to an office and support staff at least equal to the
most favorable of the foregoing provided to the Executive by Energy Group or any
of its affiliated companies at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as provided
generally at any time thereafter with respect to other peer executives of Energy
Group or any of its affiliated companies.

              (viii) VACATION. During the Employment Period, the Executive shall
be entitled to paid vacation in accordance with the most favorable plans,
policies, programs and practices of Energy Group or any of its affiliated
companies as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive,
as in effect generally at any time thereafter with respect to other peer
executives of Energy Group or any of its affiliated companies.

              6.     TERMINATION OF EMPLOYMENT. (a) DEATH OR DISABILITY. The
Executive's employment shall terminate automatically upon the Executive's death
during the Employment Period. If Energy Group determines in good faith that the
Disability of the Executive has occurred

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during the Employment Period (pursuant to the definition of Disability set forth
below), it may give to the Executive written notice in accordance with Section
13(b) of this Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's employment with Energy Group and its
affiliated companies shall terminate effective on the 30th day after receipt of
such notice by the Executive (the "Disability Effective Date"), provided that,
within the 30 days after such receipt, the Executive shall not have returned to
full-time performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's duties
with Energy Group and its affiliated companies on a full-time basis for 180
consecutive business days as a result of incapacity due to mental or physical
illness which is determined to be total and permanent by a physician selected by
Energy Group or its insurers and acceptable to the Executive or the Executive's
legal representative.

              (b)    CAUSE. Energy Group may terminate the Executive's
employment during the Employment Period for Cause. For purposes of this
Agreement, "Cause" shall mean:

              (i)    the willful and continued failure of the Executive to
       perform substantially the Executive's duties with Energy Group or any of
       its affiliated companies (other than any such failure resulting from
       incapacity due to physical or mental illness), after a written demand for
       substantial performance is delivered to the Executive by the Board which
       specifically identifies the manner in which the Board believes that the
       Executive has not substantially performed the Executive's duties, or

              (ii)   the willful engaging by the Executive in illegal conduct or
       gross misconduct which is materially and demonstrably injurious to Energy
       Group or any of its affiliated companies.

              For purposes of this provision, no act or failure to act, on the
part of the Executive, shall be considered "willful" unless it is done, or
omitted to be done, by the Executive in bad faith or without reasonable belief
that the Executive's action or omission was in the best interests of Energy
Group and its affiliated companies. Any act, or failure to act, based upon
authority given pursuant to a resolution duly adopted by the Board or based upon
the advice of counsel for Energy Group shall be conclusively presumed to be
done, or omitted to be done, by the Executive in good faith and in the best
interests of Energy Group and its affiliated companies. The cessation of
employment of the Executive shall not be deemed to be for Cause unless and until
there shall have been delivered to the Executive a copy of a resolution duly
adopted by the affirmative vote of not less than three-quarters of the entire
membership of the Board (excluding the Executive) at a meeting of the Board
called and held for such purpose (after reasonable notice is provided to the
Executive and the Executive is given an opportunity, together with counsel, to
be heard before the Board), finding that, in the good faith opinion of the
Board, the Executive is guilty of the conduct described in subparagraph (i) or
(ii) above, and specifying the particulars thereof in detail.

              (c)    GOOD REASON. The Executive's employment may be terminated
by the Executive for Good Reason. For purposes of this Agreement, "Good Reason"
shall mean:

              (i)    the assignment to the Executive of any duties inconsistent
       in any respect with the Executive's position (including status, offices,
       titles and reporting requirements),

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       authority, duties or responsibilities as contemplated by Section 5(a) of
       this Agreement (including without limitation the Executive's ceasing to
       serve as sole chief executive officer of a widely held, publicly traded
       corporation), or any other action by Energy Group or any of its
       affiliated companies which results in a diminution in such position,
       authority, duties or responsibilities, excluding for this purpose an
       isolated, insubstantial and inadvertent action not taken in bad faith and
       which is remedied by Energy Group or any of its affiliated companies
       promptly after receipt of notice thereof given by the Executive;

              (ii)   any failure by Energy Group or any of its affiliated
       companies to comply with any of the provisions of Section 5(b) of this
       Agreement, other than an isolated, insubstantial and inadvertent failure
       not occurring in bad faith and which is remedied by Energy Group or any
       of its affiliated companies promptly after receipt of notice thereof
       given by the Executive;

              (iii)  Energy Group's or any of its affiliated companies'
       requiring the Executive to be based at any office or location other than
       as provided in Section 5(a)(i)(B) hereof or Energy Group or any of its
       affiliated companies requiring the Executive to travel on company
       business to a substantially greater extent than required immediately
       prior to the Effective Date;

              (iv)   any purported termination by Energy Group or any of its
       affiliated companies of the Executive's employment otherwise than as
       expressly permitted by this Agreement; or

              (v)    any failure by Energy Group or any of its affiliated
       companies to comply with and satisfy Section 12(c) of this Agreement.

              For purposes of this Section 6(c), any good faith determination of
"Good Reason" made by the Executive shall be conclusive. Anything in this
Agreement to the contrary notwithstanding, a termination by the Executive for
any reason during the 30-day period immediately following the first anniversary
of the Effective Date shall be deemed to be a termination for Good Reason for
all purposes of this Agreement.

              (d)    NOTICE OF TERMINATION. Any termination by Energy Group for
Cause, or by the Executive for Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 13(b) of
this Agreement. For purposes of this Agreement, a "Notice of Termination" means
a written notice which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated and (iii) if the
Date of Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more than thirty
days after the giving of such notice). The failure by the Executive or Energy
Group to set forth in the Notice of Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive any right of
the Executive or Energy Group, respectively, hereunder or preclude the Executive
or Energy Group, re-

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spectively, from asserting such fact or circumstance in enforcing the
Executive's or Energy Group's rights hereunder.

              (e)    DATE OF TERMINATION. "Date of Termination" means (i) if the
Executive's employment is terminated by Energy Group for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein, as the case may be, (ii) if the Executive's
employment is terminated by Energy Group other than for Cause or Disability, the
Date of Termination shall be the date on which Energy Group notifies the
Executive of such termination and (iii) if the Executive's employment is
terminated by reason of death or Disability, the Date of Termination shall be
the date of death of the Executive or the Disability Effective Date, as the case
may be.

              7.     OBLIGATIONS OF ENERGY GROUP UPON TERMINATION. (a) GOOD
REASON; OTHER THAN FOR CAUSE, DEATH OR DISABILITY. If, during the Employment
Period, Energy Group shall terminate the Executive's employment other than for
Cause or Disability or the Executive shall terminate employment for Good Reason:

              (i)    Energy Group shall pay, or cause to be paid, to the
       Executive in a lump sum in cash within 30 days after the Date of
       Termination the aggregate of the following amounts:

                     A.     the sum of (1) the Executive's Annual Base Salary
              through the Date of Termination to the extent not theretofore
              paid, (2) the product of (x) the higher of (I) the Recent Annual
              Bonus and (II) the Annual Bonus paid or payable, including any
              bonus or portion thereof which has been earned but deferred (and
              annualized for any fiscal year consisting of less than twelve full
              months or during which the Executive was employed for less than
              twelve full months), for the most recently completed fiscal year
              during the Employment Period, if any (such higher amount being
              referred to as the "Highest Annual Bonus") and (y) a fraction, the
              numerator of which is the number of days in the current fiscal
              year through the Date of Termination, and the denominator of which
              is 365 and (3) any accrued vacation pay, in each case to the
              extent not theretofore paid (the sum of the amounts described in
              clauses (1), (2), and (3) shall be hereinafter referred to as the
              "Accrued Obligations"); and

                     B.     the amount equal to the product of (1) the Multiple
              and (2) the sum of (x) the Executive's Annual Base Salary and (y)
              the Highest Annual Bonus;

              (ii)   for a number of years after the Executive's Date of
       Termination equal to the Multiple, or such longer period as may be
       provided by the terms of the appropriate plan, program, practice or
       policy, Energy Group or any of its affiliated companies shall continue
       benefits to the Executive and/or the Executive's family at least equal to
       those which would have been provided to them in accordance with the
       plans, programs, practices and policies described in Section 5(b)(iv) of
       this Agreement if the Executive's employment had not been terminated or,
       if more favorable to the Executive, as in effect generally at any time
       thereafter with respect to other peer executives of Energy Group or any

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       of its affiliated companies and their families, provided, however, that
       if the Executive becomes reemployed with another employer and is eligible
       to receive medical or other welfare benefits under another employer
       provided plan, the medical and other welfare benefits described herein
       shall be secondary to those provided under such other plan during such
       applicable period of eligibility. For purposes of determining eligibility
       (but not the time of commencement of benefits) of the Executive for
       retiree benefits pursuant to such plans, practices, programs and
       policies, the Executive shall be considered to have remained employed
       until the expiration of a number of years after the Date of Termination
       equal to the Multiple and to have retired on the last day of such period;

              (iii)  Energy Group or any of its affiliated companies shall, at
       its sole expense as incurred, provide the Executive with outplacement
       services from a recognized outplacement service provider, the scope of
       which shall be selected by the Executive in his sole discretion but the
       cost to Energy Group of which shall not exceed $30,000; and

              (iv)   to the extent not theretofore paid or provided, Energy
       Group or any of its affiliated companies shall timely pay or provide to
       the Executive any other amounts or benefits required to be paid or
       provided or which the Executive is eligible to receive under any plan,
       program, policy or practice or contract or agreement of Energy Group or
       any of its affiliated companies (such other amounts and benefits shall be
       hereinafter referred to as the "Other Benefits").

              (b)    DEATH. If the Executive's employment is terminated by
reason of the Executive's death during the Employment Period, this Agreement
shall terminate without further obligations to the Executive's legal
representatives under this Agreement, other than for payment of Accrued
Obligations and the timely payment or provision of Other Benefits. Accrued
Obligations shall be paid to the Executive's estate or beneficiary, as
applicable, in a lump sum in cash within 30 days of the Date of Termination.
With respect to the provision of Other Benefits, the term Other Benefits as
utilized in this Section 7(b) shall include, without limitation, and the
Executive's estate and/or beneficiaries shall be entitled to receive, benefits
at least equal to the most favorable benefits provided by Energy Group or any of
its affiliated companies to the estates and beneficiaries of peer executives of
Energy Group and any such affiliated companies under such plans, programs,
practices and policies relating to death benefits, if any, as in effect with
respect to other peer executives and their beneficiaries at any time during the
120-day period immediately preceding the Effective Date or, if more favorable to
the Executive's estate and/or the Executive's beneficiaries, as in effect on the
date of the Executive's death with respect to other peer executives of Energy
Group or any of its affiliated companies and their beneficiaries.

              (c)    DISABILITY. If the Executive's employment is terminated by
reason of the Executive's Disability during the Employment Period, this
Agreement shall terminate as of the Disability Effective Date, without further
obligations to the Executive, other than for payment of Accrued Obligations and
the timely payment or provision of Other Benefits. Accrued Obligations shall be
paid to the Executive in a lump sum in cash within 30 days of the Date of
Termination. With respect to the provision of Other Benefits, the term Other
Benefits as utilized in this Section 7(c) shall include, and the Executive shall
be entitled after the Disability Effective Date to receive, disability and other
benefits at least equal to the most favorable of those generally

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provided by Energy Group or any of its affiliated companies to disabled
executives and/or their families in accordance with such plans, programs,
practices and policies relating to disability, if any, as in effect generally
with respect to other peer executives and their families at any time during the
120-day period immediately preceding the Effective Date or, if more favorable to
the Executive and/or the Executive's family, as in effect at any time thereafter
generally with respect to other peer executives of Energy Group or any of its
affiliated companies and their families.

              (d)    CAUSE; OTHER THAN FOR GOOD REASON. If the Executive's
employment shall be terminated for Cause during the Employment Period, this
Agreement shall terminate without further obligations to the Executive other
than the obligation to pay to the Executive (x) his Annual Base Salary through
the Date of Termination, (y) the amount of any compensation previously deferred
by the Executive, and (z) Other Benefits, in each case to the extent theretofore
unpaid. If the Executive voluntarily terminates employment during the Employment
Period, excluding a termination for Good Reason, this Agreement shall terminate
without further obligations to the Executive, other than for Accrued Obligations
and the timely payment or provision of Other Benefits. In such case, all Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30 days
of the Date of Termination.

              8.     NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any plan,
program, policy or practice provided by Energy Group or any of its affiliated
companies and for which the Executive may qualify, nor, subject to Section
13(f), shall anything herein limit or otherwise affect such rights as the
Executive may have under any contract or agreement with Energy Group or any of
its affiliated companies. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan, policy, practice or
program of or any contract or agreement with Energy Group or any of its
affiliated companies at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract or
agreement except as explicitly modified by this Agreement.

              9.     FULL SETTLEMENT. The obligation of Energy Group and its
affiliated companies to make the payments provided for in this Agreement and
otherwise to perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or action which
Energy Group or any of its affiliated companies may have against the Executive
or others. In no event shall the Executive be obligated to seek other employment
or take any other action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement and such amounts shall
not be reduced whether or not the Executive obtains other employment. Energy
Group agrees to pay as incurred, to the full extent permitted by law, all legal
fees and expenses which the Executive may reasonably incur as a result of any
contest (regardless of the outcome thereof) by Energy Group or any of its
affiliated companies, the Executive or others of the validity or enforceability
of, or liability under, any provision of this Agreement or any guarantee of
performance thereof (including as a result of any contest by the Executive about
the amount of any payment pursuant to this Agreement), plus in each case
interest on any delayed payment at the applicable Federal rate provided for in
Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the
"Code").

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              10.    CERTAIN ADDITIONAL PAYMENTS BY ENERGY GROUP.

              (a)    Anything in this Agreement to the contrary notwithstanding
and except as set forth below, in the event it shall be determined that any
payment or distribution by Energy Group or any of its affiliated companies to or
for the benefit of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this Section
10) (a "Payment") would be subject to the excise tax imposed by Section 4999 of
the Code or any interest or penalties are incurred by the Executive with respect
to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments. Notwithstanding the foregoing provisions of this
Section 10(a), if it shall be determined that the Executive is entitled to a
Gross-Up Payment, but that the Payments do not exceed 110% of the greatest
amount (the "Reduced Amount") that could be paid to the Executive such that the
receipt of Payments would not give rise to any Excise Tax, then no Gross-Up
Payment shall be made to the Executive and the Payments, in the aggregate, shall
be reduced to the Reduced Amount.

              (b)    Subject to the provisions of Section 10(c), all
determinations required to be made under this Section 10, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by a major accounting firm with expertise in such matters designated by the
Executive (the "Accounting Firm") which shall provide detailed supporting
calculations both to Energy Group and the Executive within 15 business days of
the receipt of notice from the Executive that there has been a Payment, or such
earlier time as is requested by Energy Group. All fees and expenses of the
Accounting Firm shall be borne solely by Energy Group. Any Gross-Up Payment, as
determined pursuant to this Section 10, shall be paid (or caused to be paid) by
Energy Group to the Executive within five days of the receipt of the Accounting
Firm's determination. Any determination by the Accounting Firm shall be binding
upon Energy Group and the Executive. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial determination
by the Accounting Firm hereunder, it is possible that Gross-Up Payments which
will not have been made by Energy Group should have been made ("Underpayment"),
consistent with the calculations required to be made hereunder. In the event
that Energy Group exhausts its remedies pursuant to Section 10(c) and the
Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be promptly paid (or caused to be paid) by
Energy Group to or for the benefit of the Executive.

              (c)    The Executive shall notify Energy Group in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by Energy Group of the Gross-Up Payment. Such notification shall be
given as soon as practicable but no later than ten business days after the
Executive is informed in writing of such claim and shall apprise Energy

                                       11
<PAGE>

Group of the nature of such claim and the date on which such claim is requested
to be paid. The Executive shall not pay such claim prior to the expiration of
the 30-day period following the date on which it gives such notice to Energy
Group (or such shorter period ending on the date that any payment of taxes with
respect to such claim is due). If Energy Group notifies the Executive in writing
prior to the expiration of such period that it desires to contest such claim,
the Executive shall:

              (i)    give Energy Group any information reasonably requested by
       Energy Group relating to such claim,

              (ii)   take such action in connection with contesting such claim
       as Energy Group shall reasonably request in writing from time to time,
       including, without limitation, accepting legal representation with
       respect to such claim by an attorney reasonably selected by Energy Group,

              (iii)  cooperate with Energy Group in good faith in order
       effectively to contest such claim, and

              (iv)   permit Energy Group to participate in any proceedings
       relating to such claim;

provided, however, that Energy Group shall bear and pay (or caused to be borne
and paid) directly all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall indemnify and hold
the Executive harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result of
such representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 10(c), Energy Group shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and sue for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as
Energy Group shall determine; provided, however, that if Energy Group directs
the Executive to pay such claim and sue for a refund, Energy Group shall advance
(or cause to be advanced) the amount of such payment to the Executive, on an
interest-free basis and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax (including interest or
penalties with respect thereto) imposed with respect to such advance or with
respect to any imputed income with respect to such advance; and further provided
that any extension of the statute of limitations relating to payment of taxes
for the taxable year of the Executive with respect to which such contested
amount is claimed to be due is limited solely to such contested amount.
Furthermore, Energy Group's control of the contest shall be limited to issues
with respect to which a Gross-Up Payment would be payable hereunder and the
Executive shall be entitled to settle or contest, as the case may be, any other
issue raised by the Internal Revenue Service or any other taxing authority.

                                       12
<PAGE>

              (d)    If, after the receipt by the Executive of an amount
advanced (or caused to be advanced) by Energy Group pursuant to Section 10(c),
the Executive becomes entitled to receive any refund with respect to such claim,
the Executive shall (subject to Energy Group's complying with the requirements
of Section 10(c)) promptly pay to Energy Group the amount of such refund
(together with any interest paid or credited thereon after taxes applicable
thereto). If, after the receipt by the Executive of an amount advanced (or cause
to be advanced) by Energy Group pursuant to Section 10(c), a determination is
made that the Executive shall not be entitled to any refund with respect to such
claim and Energy Group does not notify the Executive in writing of its intent to
contest such denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid.

              11.    CONFIDENTIAL INFORMATION. The Executive shall hold in a
fiduciary capacity for the benefit of Energy Group and its affiliated companies
all secret or confidential information, knowledge or data relating to Energy
Group or any of its affiliated companies, and their respective businesses, which
shall have been obtained by the Executive during the Executive's employment by
Energy Group or any of its affiliated companies and which shall not be or become
public knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement). After termination of the Executive's
employment with Energy Group and its affiliated companies, the Executive shall
not, without the prior written consent of Energy Group or as may otherwise be
required by law or legal process, communicate or divulge any such information,
knowledge or data to anyone other than Energy Group and those designated by it.
In no event shall an asserted violation of the provisions of this Section 11
constitute a basis for deferring or withholding any amounts otherwise payable to
the Executive under this Agreement.

              12.    SUCCESSORS. (a) This Agreement is personal to the Executive
and without the prior written consent of Energy Group shall not be assignable by
the Executive otherwise than by will or the laws of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by the
Executive's legal representatives.

              (b)    This Agreement shall inure to the benefit of and be binding
upon Energy Group and its successors and assigns.

              (c)    Energy Group will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of Energy Group to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that Energy Group would be required to perform it if no such succession
had taken place.

              13.    MISCELLANEOUS. (a) This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without
reference to principles of conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.

                                       13
<PAGE>

              (b)    All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:

              IF TO THE EXECUTIVE:

                     Paul J. Ganci
                     50 Pleasant Ridge
                     Poughkeepsie, New York  12603

              IF TO ENERGY GROUP:

                     CH Energy Group, Inc.
                     284 South Avenue
                     Poughkeepsie, New York  12601-4879

                     Attention:  Chief Financial Officer

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

              (c)    The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.

              (d)    Energy Group may withhold from any amounts payable under
this Agreement such Federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.

              (e)    The Executive's or Energy Group's failure to insist upon
strict compliance with any provision of this Agreement or the failure to assert
any right the Executive or Energy Group may have hereunder, including, without
limitation, the right of the Executive to terminate employment for Good Reason
pursuant to Section 6(c)(i)-(v) of this Agreement, shall not be deemed to be a
waiver of such provision or right or any other provision or right of this
Agreement.

              (f)    The Executive and Energy Group acknowledge that, except as
may otherwise be provided under any other written agreement between the
Executive and Energy Group, the employment of the Executive by Energy Group
and/or any of its affiliated companies is "at will" and, subject to Section 2(c)
hereof, prior to the Effective Date, the Executive's employment and/or this
Agreement may be terminated by either the Executive or Energy Group at any time
prior to the Effective Date, in which case the Executive shall have no further
rights under this

                                       14
<PAGE>

Agreement; PROVIDED, that this Agreement may not be terminated by Energy Group
if it is reasonably demonstrated by the Executive that such termination (i) was
at the request of a third party who has taken steps reasonably calculated to
effect a Change of Control or (ii) otherwise arose in connection with or
anticipation of a Change of Control. From and after the Effective Date this
Agreement shall supersede any other agreement between the parties with respect
to the subject matter hereof, including, without limitation, the Employment
Agreement entered into by the parties as of December 1, 1998, other than the
letter dated May 30, 1990 regarding confidentiality.

              IN WITNESS WHEREOF, the Executive has hereunto set the Executive's
hand and, pursuant to the authorization from its Board of Directors, Energy
Group has caused these presents to be executed in its name on its behalf, all as
of the day and year first above written.

                                      /s/ PAUL J. GANCI
                                  ----------------------------------------------
                                                   Paul J. Ganci

                                  CH Energy Group, Inc.

                                  By   /s/ JACK EFFRON
                                    --------------------------------------------
                                       Jack Effron
                                       Chairman of the Compensation & Succession
                                       Committee of the Board of DirectorsEXHIBIT (10)(iii)18

                    CENTRAL HUDSON GAS & ELECTRIC CORPORATION
                             SAVINGS INCENTIVE PLAN

<PAGE>

                                TABLE OF CONTENTS

                                    ARTICLE I
                                   DEFINITIONS

                                   ARTICLE II
                                 ADMINISTRATION

2.1    POWERS AND RESPONSIBILITIES OF THE EMPLOYER............................12
2.2    DESIGNATION OF ADMINISTRATIVE AUTHORITY................................12
2.3    POWERS AND DUTIES OF THE ADMINISTRATOR.................................12
2.4    RECORDS AND REPORTS....................................................14
2.5    APPOINTMENT OF ADVISERS................................................14
2.6    PAYMENT OF EXPENSES....................................................14
2.7    CLAIMS PROCEDURE.......................................................14
2.8    CLAIMS REVIEW PROCEDURE................................................15

                                   ARTICLE III
                                   ELIGIBILITY

3.1    CONDITIONS OF ELIGIBILITY..............................................15
3.2    EFFECTIVE DATE OF PARTICIPATION........................................15
3.3    DETERMINATION OF ELIGIBILITY...........................................16
3.4    TERMINATION OF ELIGIBILITY.............................................16
3.5    OMISSION OF ELIGIBLE EMPLOYEE..........................................16
3.6    INCLUSION OF INELIGIBLE EMPLOYEE.......................................16
3.7    ELECTION NOT TO PARTICIPATE............................................16

                                   ARTICLE IV
                           CONTRIBUTION AND ALLOCATION

4.1    FORMULA FOR DETERMINING EMPLOYER CONTRIBUTION..........................17
4.2    PARTICIPANT'S SALARY REDUCTION ELECTION................................17
4.3    TIME OF PAYMENT OF EMPLOYER CONTRIBUTION...............................20
4.4    ALLOCATION OF CONTRIBUTION AND EARNINGS................................20

<PAGE>

4.5    ACTUAL DEFERRAL PERCENTAGE TESTS.......................................22
4.6    ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS.........................24
4.7    ACTUAL CONTRIBUTION PERCENTAGE TESTS...................................26
4.8    ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS.....................28
4.9    MAXIMUM ANNUAL ADDITIONS...............................................29
4.10   ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS..............................31
4.11   TRANSFERS FROM QUALIFIED PLANS.........................................32
4.12   VOLUNTARY CONTRIBUTIONS................................................34
4.13   DIRECTED INVESTMENT ACCOUNT............................................35

                                    ARTICLE V
                                   VALUATIONS

5.1    VALUATION OF THE TRUST FUND............................................36
5.2    METHOD OF VALUATION ...................................................37

                                   ARTICLE VI
                   DETERMINATION AND DISTRIBUTION OF BENEFITS

6.1    DETERMINATION OF BENEFITS UPON RETIREMENT..............................37
6.2    DETERMINATION OF BENEFITS UPON DEATH...................................37
6.3    DETERMINATION OF BENEFITS IN EVENT OF DISABILITY.......................38
6.4    DETERMINATION OF BENEFITS UPON TERMINATION.............................38
6.5    DISTRIBUTION OF BENEFITS...............................................41
6.6    DISTRIBUTION OF BENEFITS UPON DEATH....................................43
6.7    TIME OF SEGREGATION OR DISTRIBUTION....................................44
6.8    DISTRIBUTION FOR MINOR BENEFICIARY.....................................44
6.9    LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN.........................44
6.10   PRE-RETIREMENT DISTRIBUTION............................................44
6.11   ADVANCE DISTRIBUTION FOR HARDSHIP......................................45
6.12   QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION........................46
6.13   DIRECT ROLLOVER........................................................46
6.14   ELIMINATION OF LOOKBACK RULE...........................................47

<PAGE>

                                   ARTICLE VII
                    AMENDMENT, TERMINATION, MERGERS AND LOANS

7.1    AMENDMENT..............................................................48
7.2    TERMINATION............................................................48
7.3    MERGER OR CONSOLIDATION................................................49
7.4    LOANS TO PARTICIPANTS..................................................49

                                  ARTICLE VIII
                                  MISCELLANEOUS

8.1    PARTICIPANT'S RIGHTS...................................................50
8.2    ALIENATION.............................................................51
8.3    CONSTRUCTION OF PLAN...................................................51
8.4    GENDER AND NUMBER......................................................51
8.5    LEGAL ACTION...........................................................52
8.6    PROHIBITION AGAINST DIVERSION OF FUNDS.................................52
8.7    BONDING................................................................52
8.8    EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE.............................53
8.9    INSURER'S PROTECTIVE CLAUSE............................................53
8.10   RECEIPT AND RELEASE FOR PAYMENTS.......................................53
8.11   ACTION BY THE EMPLOYER.................................................53
8.12   NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY.....................53
8.13   HEADINGS...............................................................54
8.14   APPROVAL BY INTERNAL REVENUE SERVICE...................................54
8.15   UNIFORMITY.............................................................55

                                   ARTICLE IX
                             PARTICIPATING EMPLOYERS

9.1    ADOPTION BY OTHER EMPLOYERS............................................55
9.2    REQUIREMENTS OF PARTICIPATING EMPLOYERS................................55

<PAGE>

9.3    DESIGNATION OF AGENT...................................................56
9.4    EMPLOYEE TRANSFERS.....................................................56
9.5    PARTICIPATING EMPLOYER CONTRIBUTION....................................56
9.6    AMENDMENT..............................................................56
9.7    DISCONTINUANCE OF PARTICIPATION........................................57
9.8    ADMINISTRATOR'S AUTHORITY..............................................57
9.9    PARTICIPATING EMPLOYER CONTRIBUTION FOR AFFILIATE......................57

<PAGE>

                    CENTRAL HUDSON GAS & ELECTRIC CORPORATION
                             SAVINGS INCENTIVE PLAN

         THIS PLAN, hereby adopted this 1st day of October, 2001, by Central
Hudson Gas & Electric Corporation (herein referred to as the "Employer").

                                   WITNESSETH:

                  WHEREAS, the Employer heretofore established a Profit Sharing
Plan effective Januay 1, 1984, (hereinafter called the "Effective Date") known
as Central Hudson Gas & Electric Corporation Savings Incentive Plan (herein
referred to as the "Plan") in recognition of the contribution made to its
successful operation by its employees and for the exclusive benefit of its
eligible employees; and

                  WHEREAS, under the terms of the Plan, the Employer has the
ability to amend the Plan, provided the Trustee joins in such amendment if the
provisions of the Plan affecting the Trustee are amended;

                  NOW, THEREFORE, effective October 1, 2001, except as otherwise
provided, the Employer in accordance with the provisions of the Plan pertaining
to amendments thereof, hereby amends the Plan in its entirety and restates the
Plan to provide as follows:

                                    ARTICLE I
                                   DEFINITIONS

         1.1      "Act" means the Employee Retirement Income Security Act of
1974, as it may be amended from time to time.

         1.2      "Administrator" means the Employer unless another person or
entity has been designated by the Employer pursuant to Section 2.2 to administer
the Plan on behalf of the Employer.

         1.3      "Affiliated Employer" means any corporation which is a member
of a controlled group of corporations (as defined in Code Section 414(b)) which
includes the Employer; any trade or business (whether or not incorporated) which
is under common control (as defined in Code Section 414(c)) with the Employer;
any organization (whether or not incorporated) which is a member of an
affiliated service group (as defined in Code Section 414(m)) which includes the
Employer; and any other entity required to be aggregated with the Employer
pursuant to Regulations under Code Section 414(o).

         1.4      "Anniversary Date" means December 31.

                                       1
<PAGE>

         1.5      "Beneficiary" means the person to whom the share of a deceased
Participant's total account is payable, subject to the restrictions of Sections
6.2 and 6.6.

         1.6      "Code" means the Internal Revenue Code of 1986, as amended or
replaced from time to time.

         1.7      "Compensation" with respect to any Participant means such
Participant's wages for the Plan Year within the meaning of Code Section 3401(a)
(for the purposes of income tax withholding at the source) but determined
without regard to any rules that limit the remuneration included in wages based
on the nature or location of the employment or the services performed (such as
the exception for agricultural labor in Code Section 3401 (a)(2)).

                  For purposes of this Section, the determination of
Compensation shall be made by:

                           (a)      excluding overtime.

                           (b)      excluding commissions.

                           (c)      excluding bonuses.

                           (d)      including amounts which are contributed by
                  the Employer pursuant to a salary reduction agreement and
                  which are not includible in the gross income of the
                  Participant under Code Sections 125, 402(e)(3), 402(h)(1)(B),
                  403(b) or 457(b), and Employee contributions described in Code
                  Section 414(h)(2) that are treated as Employer contributions.

                  For a Participant's initial year of participation,
Compensation shall be recognized as of such Employee's effective date of
participation pursuant to Section 3.2.

                  Compensation in excess of $150,000 shall be disregarded. Such
amount shall be adjusted for increases in the cost of living in accordance with
Code Section 401(a)(17), except that the dollar increase in effect on January 1
of any calendar year shall be effective for the Plan Year beginning with or
within such calendar year. For any short Plan Year the Compensation limit shall
be an amount equal to the Compensation limit for the calendar year in which the
Plan Year begins multiplied by the ratio obtained by dividing the number of full
months in the short Plan Year by twelve (12).

                  For purposes of this Section, if the Plan is a plan described
in Code

                                       2
<PAGE>

Section 413(c) or 414(f) (a plan maintained by more than one Employer), the
limitation applies separately with respect to the Compensation of any
Participant from each Employer maintaining the Plan.

                  If, in connection with the adoption of this amendment and
restatement, the definition of Compensation has been modified, then, for Plan
Years prior to the Plan Year which includes the adoption date of this amendment
and restatement, Compensation means compensation determined pursuant to the Plan
then in effect.

         1.8      "Contract" or "Policy" means any life insurance policy,
retirement income or annuity policy or annuity contract (group or individual)
issued pursuant to the terms of the Plan.

         1.9      "Deferred Compensation" with respect to any Participant means
the amount of the Participant's total Compensation which has been contributed to
the Plan in accordance with the Participant's deferral election pursuant to
Section 4.2 excluding any such amounts distributed as excess "annual additions"
pursuant to Section 4.10(a).

         1.10     "Designated Investment Alternative" means a specific
investment identified by name by a Fiduciary as an available investment under
the Plan which may be acquired or disposed of by the Trustee pursuant to the
investment direction by a Participant.

         1.11     "Directed Investment Option" means one or more of the
following:

                           (a)      a Designated Investment Alternative.

                           (b)      any other investment permitted by the Plan
                  and the Participant Direction Procedures and acquired or
                  disposed of by the Trustee pursuant to the investment
                  direction of a Participant.

         1.12     "Early Retirement Date" means the first day of the month
(prior to the Normal Retirement Date) coinciding with or following the date on
which a Participant or Former Participant attains age 55, and has completed at
least 10 Years of Service with the Employer (Early Retirement Age). A
Participant shall become fully Vested upon satisfying this requirement if still
employed at his Early Retirement Age.

                  A Former Participant who terminates employment after
satisfying the service requirement for Early Retirement and who thereafter
reaches the age requirement contained herein shall be entitled to receive his
benefits under this Plan.

         1.13     "Elective Contribution" means the Employer contributions to
the Plan of Deferred Compensation excluding any such amounts distributed as
excess "annual additions" pursuant to Section 4.10(a). In addition, any Employer
Qualified Non-Elective Contribution made pursuant to Section 4.1(c) and Section
4.6(b) which is used to satisfy the "Actual Deferral Percentage" tests shall be
considered an Elective
                                       3
<PAGE>

Contribution for purposes of the Plan. Any contributions deemed to be Elective
Contributions (whether or not used to satisfy the "Actual Deferral Percentage"
tests) shall be subject to the requirements of Sections 4.2(b) and 4.2(c) and
shall further be required to satisfy the nondiscrimination requirements of
Regulation 1.401(k)-1 (b)(5), the provisions of which are specifically
incorporated herein by reference.

         1.14     "Eligible Employee" means any Employee.

                  Employees who are Leased Employees within the meaning of Code
Sections 414(n)(2) and 414(o)(2) shall not be eligible to participate in this
Plan.

                  Employees of Affiliated Employers shall not be eligible to
participate in this Plan unless such Affiliated Employers have specifically
adopted this Plan in writing.

         1.15     "Employee" means any person who is employed by the Employer or
Affiliated Employer. Employee shall include Leased Employees within the meaning
of Code Sections 414(n)(2) and 414(o)(2) unless such Leased Employees are
covered by a plan described in Code Section 414(n)(5) and such Leased Employees
do not constitute more than 20% of the recipient's non- highly compensated work
force.

         1.16     "Employer" means Central Hudson Gas & Electric Corporation and
any successor which shall maintain this Plan; and any predecessor which has
maintained this Plan. The Employer is a corporation, with principal offices in
the State of New York. In addition, where appropriate, the term Employer shall
include any Participating Employer (as defined in Section 9.1) which shall adopt
this Plan.

         1.17     "Excess Aggregate Contributions" means, with respect to any
Plan Year, the excess of the aggregate amount of the Employer matching
contributions made pursuant to Section 4.1(b), voluntary Employee contributions
made pursuant to Section 4.12, Excess Contributions recharacterized as voluntary
Employee contributions pursuant to Section 4.6(a) and any qualified non-elective
contributions or elective deferrals taken into account pursuant to Section
4.7(c) on behalf of Highly Compensated Participants for such Plan Year, over the
maximum amount of such contributions permitted under the limitations of Section
4.7(a).

         1.18     "Excess Contributions" means, with respect to a Plan Year, the
excess of Elective Contributions used to satisfy the "Actual Deferral
Percentage" tests made on behalf of Highly Compensated Participants for the Plan
Year over the maximum amount of such contributions permitted under Section
4.5(a). Excess Contributions, including amounts recharacterized pursuant to
Section 4.6(a)(2), shall be treated as an "annual addition" pursuant to Section
4.9(b).

                                       4
<PAGE>

         1.19     "Excess Deferred Compensation" means, with respect to any
taxable year of a Participant, the excess of the aggregate amount of such
Participant's Deferred Compensation and the elective deferrals pursuant to
Section 4.2(f) actually made on behalf of such Participant for such taxable
year, over the dollar limitation provided for in Code Section 402(g), which is
incorporated herein by reference. Excess Deferred Compensation shall be treated
as an "annual addition" pursuant to Section 4.9(b) when contributed to the Plan
unless distributed to the affected Participant not later than the first April
15th following the close of the Participant's taxable year. However, Excess
Deferred Compensation of Non-Highly Compensated Participants is not taken into
account for purposes of Section 4.5(a) to the extent such Excess Deferred
Compensation occurs pursuant to Section 4.2(d).

         1.20     "Fiduciary" means any person who (a) exercises any
discretionary authority or discretionary control respecting management of the
Plan or exercises any authority or control respecting management or disposition
of its assets, (b) renders investment advice for a fee or other compensation,
direct or indirect, with respect to any monies or other property of the Plan or
has any authority or responsibility to do so, or (c) has any discretionary
authority or discretionary responsibility in the administration of the Plan,
including, but not limited to, the Trustee, the Employer and its representative
body, and the Administrator.

         1.21     "Fiscal Year" means the Employer's accounting year of 12
months commencing on January 1 of each year and ending the following December
31.

         1.22     "Former Participant" means a person who has been a
Participant, but who has ceased to be a Participant for any reason.

         1.23     "415 Compensation" with respect to any Participant means such
Participant's wages for the Plan Year within the meaning of Code Section 3401(a)
(for the purposes of income tax withholding at the source) but determined
without regard to any rules that limit the remuneration included in wages based
on the nature or location of the employment or the services performed (such as
the exception for agricultural labor in Code Section 3401 (a)(2)).

                  For Plan Years beginning after December 31, 1997, for purposes
of this Section, the determination of "415 Compensation" shall include any
elective deferral (as defined in Code Section 402(g)(3)), and any amount which
is contributed or deferred by the Employer at the election of the Participant
and which is not includible in the gross income of the Participant by reason of
Code Sections 125 or 457.

                  If, in connection with the adoption of this amendment and
restatement, the definition of "415 Compensation" has been modified, then, for
Plan Years prior to the Plan Year which includes the adoption date of this
amendment and restatement, "415 Compensation" means compensation determined
pursuant to the Plan then in effect.

                                       5
<PAGE>

         1.24     "414(s) Compensation" with respect to any Participant means
such Participant's Elective Contributions attributable to Deferred Compensation
recharacterized as voluntary Employee contributions pursuant to Section 4.6(a)
plus "415 Compensation" paid during a Plan Year. The amount of "414(s)
Compensation" with respect to any Participant shall include "414(s)
Compensation" for the entire twelve (12) month period ending on the last day of
such Plan Year, except that "414(s) Compensation" shall only be recognized for
that portion of the Plan Year during which an Employee was a Participant in the
Plan.

                  For purposes of this Section, the determination of "414(s)
Compensation" shall be made by including amounts which are contributed by the
Employer pursuant to a salary reduction agreement and which are not includible
in the gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions.

                  "414(s) Compensation" in excess of $150,000 shall be
disregarded. Such amount shall be adjusted for increases in the cost of living
in accordance with Code Section 401 (a)(17), except that the dollar increase in
effect on January 1 of any calendar year shall be effective for the Plan Year
beginning with or within such calendar year. For any short Plan Year the "414(s)
Compensation" limit shall be an amount equal to the "414(s) Compensation" limit
for the calendar year in which the Plan Year begins multiplied by the ratio
obtained by dividing the number of full months in the short Plan Year by twelve
(12).

                  If, in connection with the adoption of this amendment and
restatement, the definition of "414(s) Compensation" has been modified, then,
for Plan Years prior to the Plan Year which includes the adoption date of this
amendment and restatement, "414(s) Compensation" means compensation determined
pursuant to the Plan then in effect.

         1.25     "Highly Compensated Employee" means, for Plan Years beginning
after December 31, 1996, an Employee described in Code Section 414(q) and the
Regulations thereunder, and generally means an Employee who performed services
for the Employer during the "determination year" and is in one or more of the
following groups:

                           (a)      Employees who at any time during the
                  "determination year" or "look-back year" were "five percent
                  owners" of the Employer. "Five percent owner" means any person
                  who owns (or is considered as owning within the meaning of
                  Code Section 318) more than five percent of the outstanding
                  stock of the Employer or stock possessing more than five
                  percent of the total combined voting power of all stock of the
                  Employer or, in the case of an unincorporated business, any
                  person who owns more than five percent of the capital or
                  profits interest in the

                                       6
<PAGE>

                  Employer. In determining percentage ownership hereunder,
                  employers that would otherwise be aggregated under Code
                  Sections 414(b), (c), (m) and (o) shall be treated as separate
                  employers.

                           (b)      Employees who received "415 Compensation"
                  during the "look-back year" from the Employer in excess of
                  $80,000 and were in the Top Paid Group of Employees for the
                  Plan Year.

                  The "look-back year" shall be the calendar year ending with or
within the Plan Year for which testing is being performed, and the
"determination year" (if applicable) shall be the period of time, if any, which
extends beyond the "look-back year" and ends on the last day of the Plan Year
for which testing is being performed (the "lag period"). If the "lag period" is
less than twelve months long, the dollar threshold amounts specified in (b), (c)
and (d) above shall be prorated based upon the number of months in the "lag
period."

                  For purposes of this Section, the determination of "415
Compensation" shall be made by including amounts which are contributed by the
Employer pursuant to a salary reduction agreement and which are not includible
in the gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions. Additionally, the
dollar threshold amount specified in (b) above shall be adjusted at such time
and in the same manner as under Code Section 415(d), except that the base period
shall be the calendar quarter ending September 30, 1996. In the case of such an
adjustment, the dollar limit which shall be applied is the limit for the
calendar year in which the "look-back year" begins.

                  In determining who is a Highly Compensated Employee, Employees
who are non-resident aliens and who received no earned income (within the
meaning of Code Section 911 (d)(2)) from the Employer constituting United States
source income within the meaning of Code Section 861 (a)(3) shall not be treated
as Employees. Additionally, all Affiliated Employers shall be taken into account
as a single employer and Leased Employees within the meaning of Code Sections
414(n)(2) and 414(o)(2) shall be considered Employees unless such Leased
Employees are covered by a plan described in Code Section 414(n)(5) and are not
covered in any qualified plan maintained by the Employer. The exclusion of
Leased Employees for this purpose shall be applied on a uniform and consistent
basis for all of the Employer's retirement plans. Highly Compensated Former
Employees shall be treated as Highly Compensated Employees without regard to
whether they performed services during the "determination year."

         1.26     "Highly Compensated Former Employee" means a former Employee
who had a separation year prior to the "determination year" and was a Highly
Compensated Employee in the year of separation from service or in any
"determination year" after attaining age 55. Notwithstanding the foregoing, an
Employee who separated from service prior to 1987 will be treated as a Highly
Compensated Former Employee only if during the separation year (or year

                                       7
<PAGE>

preceding the separation year) or any year after the Employee attains age 55 (or
the last year ending before the Employee's 55th birthday), the Employee either
received "415 Compensation" in excess of $50,000 or was a "five percent owner."
For purposes of this Section, "determination year," "415 Compensation" and "five
percent owner" shall be determined in accordance with Section 1.25. Highly
Compensated Former Employees shall be treated as Highly Compensated Employees.
The method set forth in this Section for determining who is a "Highly
Compensated Former Employee" shall be applied on a uniform and consistent basis
for all purposes for which the Code Section 414(q) definition is applicable.

         1.27     "Highly Compensated Participant" means any Highly Compensated
Employee who is eligible to participate in the Plan.

         1.28     "Hour of Service" means (1) each hour for which an Employee is
directly or indirectly compensated or entitled to compensation by the Employer
for the performance of duties (these hours will be credited to the Employee for
the computation period in which the duties are performed); (2) each hour for
which an Employee is directly or indirectly compensated or entitled to
compensation by the Employer (irrespective of whether the employment
relationship has terminated) for reasons other than performance of duties (such
as vacation, holidays, sickness, jury duty, disability, lay-off, military duty
or leave of absence) during the applicable computation period (these hours will
be calculated and credited pursuant to Department of Labor regulation
2530.200b-2 which is incorporated herein by reference); (3) each hour for which
back pay is awarded or agreed to by the Employer without regard to mitigation of
damages (these hours will be credited to the Employee for the computation period
or periods to which the award or agreement pertains rather than the computation
period in which the award, agreement or payment is made). The same Hours of
Service shall not be credited both under (1) or (2), as the case may be, and
under (3).

                  Notwithstanding the above, (i) no more than 501 Hours of
Service are required to be credited to an Employee on account of any single
continuous period during which the Employee performs no duties (whether or not
such period occurs in a single computation period); (ii) an hour for which an
Employee is directly or indirectly paid, or entitled to payment, on account of a
period during which no duties are performed is not required to be credited to
the Employee if such payment is made or due under a plan maintained solely for
the purpose of complying with applicable worker's compensation, or unemployment
compensation or disability insurance laws; and (iii) Hours of Service are not
required to be credited for a payment which solely reimburses an Employee for
medical or medically related expenses incurred by the Employee.

                  For purposes of this Section, a payment shall be deemed to be
made by or due from the Employer regardless of whether such payment is made by
or due from the Employer directly, or indirectly through, among others, a trust
fund, or insurer, to which the Employer contributes or pays premiums and
regardless of whether contributions made or due to the trust fund, insurer, or
other entity are for

                                       8
<PAGE>

the benefit of particular Employees or are on behalf of a group of Employees in
the aggregate.

                  For purposes of this Section, Hours of Service will be
credited for employment with other Affiliated Employers. The provisions of
Department of Labor regulations 2530.200b-2(b) and (c) are incorporated herein
by reference.

         1.29     "Investment Manager" means an entity that (a) has the power to
manage, acquire, or dispose of Plan assets and (b) acknowledges fiduciary
responsibility to the Plan in writing. Such entity must be a person, firm, or
corporation registered as an investment adviser under the Investment Advisers
Act of 1940, a bank, or an insurance company.

         1.30     "Late Retirement Date" means the first day of the month
coinciding with or next following a Participant's actual Retirement Date after
having reached his Normal Retirement Date.

         1.31     "Leased Employee" means any person (other than an Employee of
the recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with Code Section
414(n)(6)) on a substantially full time basis for a period of at least one year,
and such services are of a type historically performed by employees in the
business field of the recipient employer. Contributions or benefits provided a
Leased Employee by the leasing organization which are attributable to services
performed for the recipient employer shall be treated as provided by the
recipient employer. A Leased Employee shall not be considered an Employee of the
recipient:

                           (a)      if such employee is covered by a money
                  purchase pension plan providing:

                           (1)      a non-integrated employer contribution rate
                           of at least 10% of compensation, as defined in Code
                           Section 415(c)(3), but including amounts which are
                           contributed by the Employer pursuant to a salary
                           reduction agreement and which are not includible in
                           the gross income of the Participant under Code
                           Sections 125, 402(e)(3), 402(h)(1)(B), 403(b) or
                           457(b), and Employee contributions described in Code
                           Section 414(h)(2) that are treated as Employer
                           contributions.

                           (2)      immediate participation; and

                           (3)      full and immediate vesting; and

                           (b)      if Leased Employees do not constitute more
                  than 20% of the recipient's non-highly compensated work force.

                                       9
<PAGE>

         1.32     "Net Profit" means with respect to any Fiscal Year the
Employer's net income or profit for such Fiscal Year determined upon the basis
of the Employer's books of account in accordance with generally accepted
accounting principles, without any reduction for taxes based upon income, or for
contributions made by the Employer to this Plan.

         1.33     "Non-Elective Contribution" means the Employer contributions
to the Plan excluding, however, contributions made pursuant to the Participant's
deferral election provided for in Section 4.2 and any Qualified Non-Elective
Contribution used in the "Actual Deferral Percentage" tests.

         1.34     "Non-Highly Compensated Participant" means any Participant who
is neither a Highly Compensated Employee nor a Family Member.

         1.35     "Normal Retirement Age" means the Participant's 65th birthday.
A Participant shall become fully Vested in his Participant's Account upon
attaining his Normal Retirement Age.

         1.36     "Normal Retirement Date" means the first day of the month
coinciding with or next following the Participant's Normal Retirement Age.

         1.37     "Participant" means any Eligible Employee who participates in
the Plan and has not for any reason become ineligible to participate further in
the Plan.

         1.38     "Participant Direction Procedures" means such instructions,
guidelines or policies, the terms of which are incorporated herein, as shall be
established pursuant to Section 4.13 and observed by the Administrator and
applied and provided to Participants who have Participant Directed Accounts.

         1.39     "Participant's Account" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan and Trust resulting from the Employer Non-Elective
Contributions.

                  A separate accounting shall be maintained with respect to that
portion of the Participant's Account attributable to Employer matching
contributions made pursuant to Section 4.1(b), Employer discretionary
contributions made pursuant to Section 4.1(d) and any Employer Qualified Non-
Elective Contributions.

         1.40     "Participant's Combined Account" means the total aggregate
amount of each Participant's Elective Account and Participant's Account.

         1.41     "Participant's Directed Account" means that portion of a
Participant's interest in the Plan with respect to which the Participant has
directed the investment in accordance with the Participant Direction Procedure.

         1.42     "Participant's Elective Account" means the account established
and maintained by the Administrator for each Participant with respect to his
total interest

                                       10
<PAGE>

in the Plan and Trust resulting from the Employer Elective Contributions used to
satisfy the "Actual Deferral Percentage" tests. A separate accounting shall be
maintained with respect to that portion of the Participant's Elective Account
attributable to such Elective Contributions pursuant to Section 4.2 and any
Employer Qualified Non-Elective Contributions.

         1.43     "Plan" means this instrument, including all amendments
thereto.

         1.44     "Plan Year" means the Plan's accounting year of twelve (12)
months commencing on January 1 of each year and ending the following December
31.

         1.45     "Qualified Non-Elective Contribution" means any Employer
contributions made pursuant to Section 4.1(c) and Section 4.6(b) and Section
4.8(g). Such contributions shall be considered an Elective Contribution for the
purposes of the Plan and may be used to satisfy the "Actual Deferral Percentage"
tests or the "Actual Contribution Percentage" tests.

         1.46     "Regulation" means the Income Tax Regulations as promulgated
by the Secretary of the Treasury or his delegate, and as amended from time to
time.

         1.47     "Retired Participant" means a person who has been a
Participant, but who has become entitled to retirement benefits under the Plan.

         1.48     "Retirement Date" means the date as of which a Participant
retires for reasons other than Total and Permanent Disability, whether such
retirement occurs on a Participant's Normal Retirement Date, Early or Late
Retirement Date (see Section 6.1).

         1.49     "Terminated Participant" means a person who has been a
Participant, but whose employment has been terminated other than by death, Total
and Permanent Disability or retirement.

         1.50     "Top Paid Group" means the top 20 percent of Employees who
performed services for the Employer during the applicable year, ranked according
to the amount of "415 Compensation" (determined for this purpose in accordance
with Section 1.25) received from the Employer during such year. All Affiliated
Employers shall be taken into account as a single employer, and Leased Employees
within the meaning of Code Sections 414(n)(2) and 414(o)(2) shall be considered
Employees unless such Leased Employees are covered by a plan described in Code
Section 414(n)(5) and are not covered in any qualified plan maintained by the
Employer. Employees who are non-resident aliens and who received no earned
income (within the meaning of Code Section 911 (d)(2)) from the Employer
constituting United States source income within the meaning of Code Section 861
(a)(3) shall not be treated as Employees. Additionally, for the purpose of
determining the number of active Employees in any year, the following additional
Employees shall also be excluded; however, such Employees shall still be
considered for the purpose of identifying the particular Employees in the Top
Paid Group:

                                       11
<PAGE>

                           (a)      Employees with less than six (6) months of
                  service;

                           (b)      Employees who normally work less than 17 1/2
                  hours per week;

                           (c)      Employees who normally work less than six
                  (6) months during a year; and

                           (d)      Employees who have not yet attained age 21.

                  In addition, if 90 percent or more of the Employees of the
Employer are covered under agreements the Secretary of Labor finds to be
collective bargaining agreements between Employee representatives and the
Employer, and the Plan covers only Employees who are not covered under such
agreements, then Employees covered by such agreements shall be excluded from
both the total number of active Employees as well as from the identification of
particular Employees in the Top Paid Group.

                  The foregoing exclusions set forth in this Section shall be
applied on a uniform and consistent basis for all purposes for which the Code
Section 414(q) definition is applicable.

         1.51     "Total and Permanent Disability" means a physical or mental
condition of a Participant resulting from bodily injury, disease, or mental
disorder which renders him incapable of continuing any gainful occupation and
which condition constitutes total disability under the federal Social Security
Acts.

         1.52     "Trustee" means the person or entity named as trustee herein
or in any separate trust forming a part of this Plan, and any successors.

         1.53     "Trust Fund" means the assets of the Plan and Trust as the
same shall exist from time to time.

         1.54     "USERRA" means the Uniformed Services Employment and
Reemployment Rights Act of 1994. Notwithstanding any provision of this Plan to
the contrary, effective December 12,1994, contributions, benefits and service
credit with respect to qualified military service will be provided in accordance
with Code Section 414(u).

         1.55     "Valuation Date" means the Anniversary Date and such other
date or dates deemed necessary by the Administrator. The Valuation Date may
include any day during the Plan Year that the Trustee, any transfer agent
appointed by the Trustee or the Employer and any stock exchange used by such
agent are open for business.

                                       12
<PAGE>

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

         1.57     "Voluntary Contribution Account" means the account established
and maintained by the Administrator for each Participant with respect to his
total interest in the Plan resulting from the Participant's nondeductible
voluntary contributions made pursuant to Section 4.12.

                  Amounts recharacterized as voluntary Employee contributions
pursuant to Section 4.6(a) shall remain subject to the limitations of Sections
4.2(b) and 4.2(c).

                  Therefore, a separate accounting shall be maintained with
respect to that portion of the Voluntary Contribution Account attributable to
voluntary Employee contributions made pursuant to Section 4.12.

         1.58     "Year of Service" means the computation period of twelve (12)
consecutive months, herein set forth, during which an Employee has at least 1000
Hours of Service.

                  The computation period shall be the Plan Year if not otherwise
set forth herein.

                  Notwithstanding the foregoing, for any short Plan Year, the
determination of whether an Employee has completed a Year of Service shall be
made in accordance with Department of Labor regulation 2530.203-2(c).

                  Years of Service with any Affiliated Employer shall be
recognized.

                                   ARTICLE II
                                 ADMINISTRATION

2.1      POWERS AND RESPONSIBILITIES OF THE EMPLOYER

                           (a)      In addition to the general powers and
                  responsibilities otherwise provided for in this Plan, the
                  Employer shall be empowered to appoint and remove the Trustee
                  and the Administrator from time to time as it deems necessary
                  for the proper administration of the Plan to ensure that the
                  Plan is being operated for the exclusive benefit of the
                  Participants and their Beneficiaries in accordance with the
                  terms of the Plan, the Code, and the Act. The Employer may
                  appoint counsel, specialists, advisers, agents (including any
                  nonfiduciary agent) and other persons as the Employer deems
                  necessary or desirable in connection with the exercise of its
                  fiduciary duties under this Plan. The Employer may compensate
                  such agents or advisers from the assets of the Plan as
                  fiduciary expenses (but not including any business (settlor)

                                       13
<PAGE>

                  expenses of the Employer), to the extent not paid by the
                  Employer.

                           (b)      The Employer shall establish a "funding
                  policy and method," i.e., it shall determine whether the Plan
                  has a short run need for liquidity (e.g., to pay benefits) or
                  whether liquidity is a long run goal and investment growth
                  (and stability of same) is a more current need, or shall
                  appoint a qualified person to do so. The Employer or its
                  delegate shall communicate such needs and goals to the
                  Trustee, who shall coordinate such Plan needs with its
                  investment policy. The communication of such a "funding policy
                  and method" shall not, however, constitute a directive to the
                  Trustee as to investment of the Trust Funds. Such "funding
                  policy and method" shall be consistent with the objectives of
                  this Plan and with the requirements of Title I of the Act.

                           (c)      The Employer shall periodically review the
                  performance of any Fiduciary or other person to whom duties
                  have been delegated or allocated by it under the provisions of
                  this Plan or pursuant to procedures established hereunder.
                  This requirement may be satisfied by formal periodic review by
                  the Employer or by a qualified person specifically designated
                  by the Employer, through day-to-day conduct and evaluation, or
                  through other appropriate ways.

2.2      DESIGNATION OF ADMINISTRATIVE AUTHORITY

                  The Employer shall be the Administrator. The Employer may
appoint any person, including, but not limited to, the Employees of the
Employer, to perform the duties of the Administrator. Any person so appointed
shall signify his acceptance by filing written acceptance with the Employer.
Upon the resignation or removal of any individual performing the duties of the
Administrator, the Employer may designate a successor.

2.3      POWERS AND DUTIES OF THE ADMINISTRATOR

                  The primary responsibility of the Administrator is to
administer the Plan for the exclusive benefit of the Participants and their
Beneficiaries, subject to the specific terms of the Plan. The Administrator
shall administer the Plan in accordance with its terms and shall have the power
and discretion to construe the terms of the Plan and to determine all questions
arising in connection with the administration, interpretation, and application
of the Plan. Any such determination by the Administrator shall be conclusive and
binding upon all persons. The Administrator may establish procedures, correct
any defect, supply any information, or reconcile any inconsistency in such
manner and to such extent as shall be deemed necessary or advisable to carry out
the purpose of the Plan; provided, however, that any procedure, discretionary
act, interpretation or construction shall be done in a nondiscriminatory manner
based upon uniform principles consistently applied and shall be consistent with
the intent that the Plan shall continue to be deemed a qualified plan under the
terms of Code Section 401(a), and shall comply with the terms of the

                                       14
<PAGE>

Act and all regulations issued pursuant thereto. The Administrator shall have
all powers necessary or appropriate to accomplish his duties under this Plan.

                  The Administrator shall be charged with the duties of the
general administration of the Plan, including, but not limited to, the
following:

                           (a)      the discretion to determine all questions
                  relating to the eligibility of Employees to participate or
                  remain a Participant hereunder and to receive benefits under
                  the Plan;

                           (b)      to compute, certify, and direct the Trustee
                  with respect to the amount and the kind of benefits to which
                  any Participant shall be entitled hereunder;

                           (c)      to authorize and direct the Trustee with
                  respect to all nondiscretionary or otherwise directed
                  disbursements from the Trust;

                           (d)      to maintain all necessary records for the
                  administration of the Plan;

                           (e)      to interpret the provisions of the Plan and
                  to make and publish such rules for regulation of the Plan as
                  are consistent with the terms hereof;

                           (f)      to determine the size and type of any
                  Contract to be purchased from any insurer, and to designate
                  the insurer from which such Contract shall be purchased;

                           (g)      to compute and certify to the Employer and
                  to the Trustee from time to time the sums of money necessary
                  or desirable to be contributed to the Plan;

                           (h)      to consult with the Employer and the Trustee
                  regarding the short and long-term liquidity needs of the Plan
                  in order that the Trustee can exercise any investment
                  discretion in a manner designed to accomplish specific
                  objectives;

                           (i)      to prepare and implement a procedure to
                  notify Eligible Employees that they may elect to have a
                  portion of their Compensation deferred or paid to them in
                  cash;

                           (j)      to act as the named Fiduciary responsible
                  for communications with Participants as needed to maintain
                  Plan compliance with ERISA Section 404(c), including but not
                  limited to the receipt and transmitting of Participant's
                  directions as to the investment of their account(s) under the
                  Plan and the formulation of policies, rules, and procedures
                  pursuant to which Participants may give investment

                                       15
<PAGE>

                  instructions with respect to the investment of their accounts;

                           (k)      to assist any Participant regarding his
                  rights, benefits, or elections available under the Plan.

2.4      RECORDS AND REPORTS

                  The Administrator shall keep a record of all actions taken and
shall keep all other books of account, records, policies, and other data that
may be necessary for proper administration of the Plan and shall be responsible
for supplying all information and reports to the Internal Revenue Service,
Department of Labor, Participants, Beneficiaries and others as required by law.

2.5      APPOINTMENT OF ADVISERS

                  The Administrator, or the Trustee with the consent of the
Administrator, may appoint counsel, specialists, advisers, agents (including
nonfiduciary agents) and other persons as the Administrator or the Trustee deems
necessary or desirable in connection with the administration of this Plan,
including but not limited to agents and advisers to assist with the
administration and management of the Plan, and thereby to provide, among such
other duties as the Administrator may appoint, assistance with maintaining Plan
records and the providing of investment information to the Plan's investment
fiduciaries and to Plan Participants.

2.6      PAYMENT OF EXPENSES

                  All expenses of administration may be paid out of the Trust
Fund unless paid by the Employer. Such expenses shall include any expenses
incident to the functioning of the Administrator, or any person or persons
retained or appointed by any Named Fiduciary incident to the exercise of their
duties under the Plan, including, but not limited to, fees of accountants,
counsel, Investment Managers, agents (including nonfiduciary agents) appointed
for the purpose of assisting the Administrator or the Trustee in carrying out
the instructions of Participants as to the directed investment of their accounts
and other specialists and their agents, and other costs of administering the
Plan. Until paid, the expenses shall constitute a liability of the Trust Fund.

2.7      CLAIMS PROCEDURE

                  Claims for benefits under the Plan may be filed in writing
with the Administrator. Written notice of the disposition of a claim shall be
furnished to the claimant within 90 days after the application is filed. In the
event the claim is denied, the reasons for the denial shall be specifically set
forth in the notice in language calculated to be understood by the claimant,
pertinent provisions of the Plan shall be cited, and, where appropriate, an
explanation as to how the claimant can perfect the claim will be provided. In
addition, the claimant shall be furnished with an explanation

                                       16
<PAGE>

of the Plan's claims review procedure.

2.8      CLAIMS REVIEW PROCEDURE

                  Any Employee, former Employee, or Beneficiary of either, who
has been denied a benefit by a decision of the Administrator pursuant to Section
2.7 shall be entitled to request the Administrator to give further consideration
to his claim by filing with the Administrator (on a form which may be obtained
from the Administrator) a request for a hearing. Such request, together with a
written statement of the reasons why the claimant believes his claim should be
allowed, shall be filed with the Administrator no later than 60 days after
receipt of the written notification provided for in Section 2.7. The
Administrator shall then conduct a hearing within the next 60 days, at which the
claimant may be represented by an attorney or any other representative of his
choosing and at which the claimant shall have an opportunity to submit written
and oral evidence and arguments in support of his claim. At the hearing (or
prior thereto upon 5 business days written notice to the Administrator) the
claimant or his representative shall have an opportunity to review all documents
in the possession of the Administrator which are pertinent to the claim at issue
and its disallowance. Either the claimant or the Administrator may cause a court
reporter to attend the hearing and record the proceedings. In such event, a
complete written transcript of the proceedings shall be furnished to both
parties by the court reporter. The full expense of any such court reporter and
such transcripts shall be borne by the party causing the court reporter to
attend the hearing. A final decision as to the allowance of the claim shall be
made by the Administrator within 60 days of receipt of the appeal (unless there
has been an extension of 60 days due to special circumstances, provided the
delay and the special circumstances occasioning it are communicated to the
claimant within the 60 day period). Such communication shall be written in a
manner calculated to be understood by the claimant and shall include specific
reasons for the decision and specific references to the pertinent Plan
provisions on which the decision is based.

                                   ARTICLE III

                                   ELIGIBILITY

3.1      CONDITIONS OF ELIGIBILITY

                  Any Eligible Employee shall be eligible to participate
hereunder on the date of his employment with the Employer. However, any Employee
who was a Participant in the Plan prior to the effective date of this amendment
and restatement shall continue to participate in the Plan.

3.2      EFFECTIVE DATE OF PARTICIPATION

                  An Eligible Employee shall become a Participant effective as
of the date on which he satisfies the eligibility requirements of Section 3.1.

                                       17
<PAGE>

                  In the event an Employee who is not a member of an eligible
class of Employees becomes a member of an eligible class, such Employee will
participate immediately if such Employee would have otherwise previously become
a Participant.

3.3      DETERMINATION OF ELIGIBILITY

                  The Administrator shall determine the eligibility of each
Employee for participation in the Plan based upon information furnished by the
Employer. Such determination shall be conclusive and binding upon all persons,
as long as the same is made pursuant to the Plan and the Act. Such determination
shall be subject to review per Section 2.8.

3.4      TERMINATION OF ELIGIBILITY

                           (a)      In the event a Participant shall go from a
                  classification of an Eligible Employee to an ineligible
                  Employee, such Former Participant shall continue to vest in
                  his interest in the Plan for each Year of Service completed
                  while a noneligible Employee, until such time as his
                  Participant's Account shall be forfeited or distributed
                  pursuant to the terms of the Plan. Additionally, his interest
                  in the Plan shall continue to share in the earnings of the
                  Trust Fund.

                           (b)      In the event a Participant is no longer a
                  member of an eligible class of Employees and becomes
                  ineligible to participate, such Employee will participate
                  immediately upon returning to an eligible class of Employees.

3.5      OMISSION OF ELIGIBLE EMPLOYEE

                  If, in any Plan Year, any Employee who should be included as a
Participant in the Plan is erroneously omitted and discovery of such omission is
not made until after a contribution by his Employer for the year has been made,
the Employer shall make a subsequent contribution with respect to the omitted
Employee in the amount which the said Employer would have contributed with
respect to him had he not been omitted. Such contribution shall be made
regardless of whether or not it is deductible in whole or in part in any taxable
year under applicable provisions of the Code.

3.6      INCLUSION OF INELIGIBLE EMPLOYEE

                  If, in any Plan Year, any person who should not have been
included as a Participant in the Plan is erroneously included and discovery of
such incorrect inclusion is not made until after a contribution for the year has
been made, the Employer shall not be entitled to recover the contribution made
with respect to the ineligible person regardless of whether or not a deduction
is allowable with respect to such contribution. In such event, the amount
contributed with respect to the ineligible person shall constitute a Forfeiture
(except for Deferred Compensation which shall be

                                       18
<PAGE>

distributed to the ineligible person) for the Plan Year in which the discovery
is made.

3.7      ELECTION NOT TO PARTICIPATE

                  An Employee may, subject to the approval of the Employer,
elect voluntarily not to participate in the Plan. The election not to
participate must be communicated to the Employer, in writing, at least thirty
(30) days before the beginning of a Plan Year.

                                   ARTICLE IV
                           CONTRIBUTION AND ALLOCATION

4.1      FORMULA FOR DETERMINING EMPLOYER CONTRIBUTION

                  For each Plan Year, the Employer shall contribute to the Plan:

                           (a)      The amount of the total salary reduction
                  elections of all Participants made pursuant to Section 4.2(a),
                  which amount shall be deemed an Employer Elective
                  Contribution.

                           (b)      On behalf of each Participant who is
                  eligible to share in matching contributions for the Plan Year,
                  a discretionary matching contribution equal to a uniform
                  percentage of each such Participant's Deferred Compensation,
                  the exact percentage, if any, to be determined each year by
                  the Employer, which amount, if any, shall be deemed an
                  Employer Non-Elective Contribution.

                                    Except, however, in applying the matching
                  percentage specified above, only salary reductions up to 6% of
                  Compensation for Participants subject to a collective
                  bargaining agreement and 8% of Compensation for all other
                  Participants shall be considered.

                           (c)      On behalf of each Non-Highly Compensated
                  Participant who is eligible to share in the Qualified
                  Non--Elective Contribution for the Plan Year, a discretionary
                  Qualified Non- Elective Contribution equal to a uniform
                  percentage of each eligible individual's Compensation, the
                  exact percentage, if any, to be determined each year by the
                  Employer. Any Employer Qualified Non-Elective Contribution
                  shall be deemed an Employer Elective Contribution.

                           (d)      A discretionary amount out of its current or
                  accumulated Net Profits, which amount, if any, shall be deemed
                  an Employer Non-Elective Contribution.

                           (e)      All contributions by the Employer shall be
                  made in cash.

4.2      PARTICIPANT'S SALARY REDUCTION ELECTION

                                       19
<PAGE>

                           (a)      Each Participant may elect to defer from 1%
                  to 12% of his Compensation which would have been received in
                  the Plan Year, but for the deferral election. A deferral
                  election (or modification of an earlier election) may not be
                  made with respect to Compensation which is currently available
                  on or before the date the Participant executed such election.
                  For purposes of this Section, Compensation shall be determined
                  prior to any reductions made pursuant to Code Sections 125,
                  402(e)(3), 402(h)(1)(B), 403(b) or 457(b), and Employee
                  contributions described in Code Section 414(h)(2) that are
                  treated as Employer contributions.

                                    The amount by which Compensation is reduced
                  shall be that Participant's Deferred Compensation and be
                  treated as an Employer Elective Contribution and allocated to
                  that Participant's Elective Account.

                           (b)      The balance in each Participant's Elective
                  Account shall be fully Vested at all times and shall not be
                  subject to Forfeiture for any reason.

                           (c)      Notwithstanding anything in the Plan to the
                  contrary, amounts held in the Participant's Elective Account
                  may not be distributable (including any offset of loans)
                  earlier than:

                           (1)      a Participant's separation from service,
                  Total and Permanent Disability, or death;

                           (2)      Participant's attainment of age 59 1/2;

                           (3)      the termination of the Plan without the
         establishment or existence of a "successor plan," as that term is
         described in Regulation 1.401(k)-1(d)(3);

                           (4)      the date of disposition by the Employer to
         an entity that is not an Affiliated Employer of substantially all of
         the assets (within the meaning of Code Section 409(d)(2)) used in a
         trade or business of such corporation if such corporation continues to
         maintain this Plan after the disposition with respect to a Participant
         who continues employment with the corporation acquiring such assets;

                           (5)      the date of disposition by the Employer or
         an Affiliated Employer who maintains the Plan of its interest in a
         subsidiary (within the meaning of Code Section 409(d)(3)) to an entity
         which is not an Affiliated Employer but only with respect to a
         Participant who continues employment with such subsidiary; or

                                       20
<PAGE>

                           (6)      the proven financial hardship of a
         Participant, subject to the limitations of Section 6.11.

                           (d)      For each Plan Year, a Participant's Deferred
                  Compensation made under this Plan and all other plans,
                  contracts or arrangements of the Employer maintaining this
                  Plan shall not exceed, during any taxable year of the
                  Participant, the limitation imposed by Code Section 402(g), as
                  in effect at the beginning of such taxable year. If such
                  dollar limitation is exceeded, a Participant will be deemed to
                  have notified the Administrator of such excess amount which
                  shall be distributed in a manner consistent with Section
                  4.2(f). The dollar limitation shall be adjusted annually
                  pursuant to the method provided in Code Section 415(d) in
                  accordance with Regulations.

                           (e)      In the event a Participant has received a
                  hardship distribution pursuant to Regulation
                  1.401(k)-1(d)(2)(iv)(B) from any other plan maintained by the
                  Employer, then such Participant shall not be permitted to
                  elect to have Deferred Compensation contributed to the Plan on
                  his behalf for a period of twelve (12) months following the
                  receipt of the distribution. Furthermore, the dollar
                  limitation under Code Section 402(g) shall be reduced, with
                  respect to the Participant's taxable year following the
                  taxable year in which the hardship distribution was made, by
                  the amount of such Participant's Deferred Compensation, if
                  any, pursuant to this Plan (and any other plan maintained by
                  the Employer) for the taxable year of the hardship
                  distribution.

                           (f)      If a Participant's Deferred Compensation
                  under this Plan together with any elective deferrals (as
                  defined in Regulation 1.402(g)-1(b)) under another qualified
                  cash or deferred arrangement (as defined in Code Section
                  401(k)), a simplified employee pension (as defined in Code
                  Section 408(k)), a salary reduction arrangement (within the
                  meaning of Code Section 3121 (a)(5)(D)), a deferred
                  compensation plan under Code Section 457(b), or a trust
                  described in Code Section 501 (c)(18) cumulatively exceed the
                  limitation imposed by Code Section 402(g) (as adjusted
                  annually in accordance with the method provided in Code
                  Section 415(d) pursuant to Regulations) for such Participant's
                  taxable year, the Participant may, not later than March 1
                  following the close of the Participant's taxable year, notify
                  the Administrator in writing of such excess and request that
                  his Deferred Compensation under this Plan be reduced by an
                  amount specified by the Participant. In such event, the
                  Administrator may direct the Trustee to distribute such excess
                  amount (and any Income allocable to such excess amount) to the
                  Participant not later than the first April 15th following the
                  close of the Participant's taxable year. Any distribution of
                  less than the entire amount of Excess Deferred Compensation
                  and Income shall be treated as a pro rata distribution of
                  Excess Deferred Compensation and

                                       21
<PAGE>

                  Income. The amount distributed shall not exceed the
                  Participant's Deferred Compensation under the Plan for the
                  taxable year (and any Income allocable to such excess amount).
                  Any distribution on or before the last day of the
                  Participant's taxable year must satisfy each of the following
                  conditions:

                  (1)      the distribution must be made after the date on which
         the Plan received the Excess Deferred Compensation;

                  (2)      the Participant shall designate the distribution as
         Excess Deferred Compensation; and

                  (3)      the Plan must designate the distribution as a
         distribution of Excess Deferred Compensation.

                  Any distribution made pursuant to this Section 4.2(f) shall be
made first from unmatched Deferred Compensation and, thereafter, from Deferred
Compensation which is matched. Matching contributions which relate to such
Deferred Compensation shall be forfeited.

                           (g)      Notwithstanding Section 4.2(f) above, a
                  Participant's Excess Deferred Compensation shall be reduced,
                  but not below zero, by any distribution and/or
                  recharacterization of Excess Contributions pursuant to Section
                  4.6(a) for the Plan Year beginning with or within the taxable
                  year of the Participant.

                           (h)      At Normal Retirement Date, or such other
                  date when the Participant shall be entitled to receive
                  benefits, the fair market value of the Participant's Elective
                  Account shall be used to provide additional benefits to the
                  Participant or his Beneficiary.

                           (i)      Employer Elective Contributions made
                  pursuant to this Section may be segregated into a separate
                  account for each Participant in a federally insured savings
                  account, certificate of deposit in a bank or savings and loan
                  association, money market certificate, or other short-term
                  debt security acceptable to the Trustee until such time as the
                  allocations pursuant to Section 4.4 have been made.

                           (j)      The Employer and the Administrator shall
                  implement the salary reduction elections provided for herein
                  in accordance with the following:

4.3      TIME OF PAYMENT OF EMPLOYER CONTRIBUTION

                  The Employer shall generally pay to the Trustee its
contribution to the

                                       22
<PAGE>

Plan for each Plan Year within the time prescribed by law, including extensions
of time, for the filing of the Employer federal income tax return for the Fiscal
Year.

                  However, Employer Elective Contributions accumulated through
payroll deductions shall be paid to the Trustee as of the earliest date on which
such contributions can reasonably be segregated from the Employer general
assets, but in any event within ninety (90) days from the date on which such
amounts would otherwise have been payable to the Participant in cash. The
provisions of Department of Labor regulations 2510.3-102 are incorporated herein
by reference. Furthermore, any additional Employer contributions which are
allocable to the Participant's Elective Account for a Plan Year shall be paid to
the Plan no later than the twelve-month period immediately following the close
of such Plan Year.

4.4      ALLOCATION OF CONTRIBUTION AND EARNINGS

                           (a)      The Administrator shall establish and
                  maintain an account in the name of each Participant to which
                  the Administrator shall credit as of each Anniversary Date all
                  amounts allocated to each such Participant as set forth
                  herein.

                           (b)      The Employer shall provide the Administrator
                  with all information required by the Administrator to make a
                  proper allocation of the Employer contributions for each Plan
                  Year. Within a reasonable period of time after the date of
                  receipt by the Administrator of such information, the
                  Administrator shall allocate such contribution as follows:

                           (1)      With respect to the Employer Elective
                           Contribution made pursuant to Section 4.1(a), to each
                           Participant's Elective Account in an amount equal to
                           each such Participant's Deferred Compensation for the
                           year.

         (2)      With respect to the Employer Non-Elective Contribution made
         pursuant to Section 4.1(b), to each Participant's Account in accordance
         with Section 4.1(b).

         Any Participant actively employed during the Plan Year shall be
         eligible to share in the matching contribution for the Plan Year.
         However, with respect to Plan Years beginning after December 31, 1989,
         in lieu of the foregoing, only Participants who are actively employed
         during the Plan Year shall be eligible to share in the matching
         contributions for the year.

         (3)      With respect to the Employer Qualified Non-Elective
         Contribution made pursuant to Section 4.1(c), to each Participant's
         Elective Account when used to satisfy the "Actual Deferral Percentage"
         tests or Participant's Account in accordance with Section 4.1(c).

                                       23
<PAGE>

         Any Non-Highly Compensated Participant actively employed during the
         Plan Year shall be eligible to share in the Qualified Non-Elective
         Contribution for the Plan Year. However, with respect to Plan Years
         beginning after December 31, 1989, in lieu of the foregoing, only Non-
         Highly Compensated Participants who are actively employed during the
         Plan Year shall be eligible to share in the Qualified Non-Elective
         Contribution for the year.

         (4)      With respect to the Employer Non-Elective Contribution made
         pursuant to Section 4.1(d), to each Participant's Account in the same
         proportion that each such Participant's Compensation for the year bears
         to the total Compensation of all Participants for such year.

         Any Participant actively employed during the Plan Year shall be
         eligible to share in the discretionary contribution for the year.
         However, with respect to Plan Years beginning after December 31, 1989,
         in lieu of the foregoing, only Participants who are actively employed
         during the Plan Year shall be eligible to share in the discretionary
         contribution for the year.

         (c)      As of each Anniversary Date any amounts which became
Forfeitures since the last Anniversary Date shall first be made available to
reinstate previously forfeited account balances of Former Participants, if any,
in accordance with Section 6.4(f)(2). The remaining Forfeitures, if any, shall
be in the following manner:

         (1)      Forfeitures attributable to Employer discretionary
         contributions made pursuant to Section 4.1(d) shall be used to reduce
         the Employer contribution for the Plan Year in which such Forfeitures
         occur.

         (d)      Notwithstanding the foregoing, Participants who are not
actively employed on the last day of the Plan Year due to Retirement (Early,
Normal or Late), Total and Permanent Disability or death shall share in the
allocation of contributions for that Plan Year.

                                    Participants' transfers from other qualified
                  plans and voluntary contributions deposited in the general
                  Trust Fund shall share in any earnings and losses (net
                  appreciation or net depreciation) of the Trust Fund in the
                  same manner provided above. Each segregated account maintained
                  on behalf of a Participant shall be credited or charged with
                  its separate earnings and losses.

                           (e)      Notwithstanding anything herein to the
                  contrary, Participants who terminated employment for any
                  reason during the Plan Year shall share in the salary
                  reduction contributions made by the Employer for the year of
                  termination without regard to the Hours of Service credited.

                           (f)      If a Former Participant is reemployed after
                  five (5) consecutive 1-Year Breaks in Service, then separate
                  accounts shall be

                                       24
<PAGE>

                  maintained as follows:

                           (1)      one account for nonforfeitable benefits
                           attributable to pre- break service; and

                           (2)      one account representing his status in the
                           Plan attributable to post-break service.

4.5      ACTUAL DEFERRAL PERCENTAGE TESTS

                           (a)      Maximum Annual Allocation: For each Plan
                  Year, the annual allocation derived from Employer Elective
                  Contributions to a Participant's Elective Account shall
                  satisfy one of the following tests:

                           (1)      The "Actual Deferral Percentage" for the
                  Highly Compensated Participant group shall not be more than
                  the "Actual Deferral percentage" of the Non-Highly Compensated
                  Participant group multiplied by 1.25, or

                                    (2)      The excess of the "Actual Deferral
                           Percentage" for the Highly Compensated Participant
                           group over the "Actual Deferral Percentage" for the
                           Non-Highly Compensated Participant group shall not be
                           more than two percentage points. Additionally, the
                           "Actual Deferral Percentage" for the Highly
                           Compensated Participant group shall not exceed the
                           "Actual Deferral Percentage" for the Non-Highly
                           Compensated Participant group multiplied by 2. The
                           provisions of Code Section 401(k)(3) and Regulation
                           1.401(k)-1(b) are incorporated herein by reference.

                                    However, in order to prevent the multiple
                           use of the alternative method described in (2) above
                           and in Code Section 401(m)(9)(A), any Highly
                           Compensated Participant eligible to make elective
                           deferrals pursuant to Section 4.2 and to make
                           Employee contributions or to receive matching
                           contributions under this Plan or under any other plan
                           maintained by the Employer or an Affiliated Employer
                           shall have a combination of his actual deferral ratio
                           and his actual contribution ratio reduced pursuant to
                           Section 4.6(a) and Regulation 1.401(m)-2, the
                           provisions of which are incorporated herein by
                           reference.

         (b)      For the purposes of this Section "Actual Deferral Percentage"
means, with respect to the Highly Compensated Participant group and Non- Highly
Compensated Participant group for a Plan Year, the average of the ratios,
calculated separately for each Participant in such group, of the amount of
Employer Elective Contributions allocated to each Participant's Elective Account
for such Plan Year, to such Participant's "414(s) Compensation" for such Plan
Year. The actual deferral

                                       25
<PAGE>

ratio for each Participant and the "Actual Deferral Percentage" for each group
shall be calculated to the nearest one-hundredth of one percent. Employer
Elective Contributions allocated to each Non-Highly Compensated Participant's
Elective Account shall be reduced by Excess Deferred Compensation to the extent
such excess amounts are made under this Plan or any other plan maintained by the
Employer.

         (c)      For the purposes of Sections 4.5(a) and 4.6, a Highly
Compensated Participant and a Non-Highly Compensated Participant shall include
any Employee eligible to make a deferral election pursuant to Section 4.2,
whether or not such deferral election was made or suspended pursuant to Section
4.2.

         (d)      For the purposes of this Section and Code Sections 401(a)(4),
410(b) and 401(k), if two or more plans which include cash or deferred
arrangements are considered one plan for the purposes of Code Section 401(a)(4)
or 410(b) (other than Code Section 410 (b)(2)(A)(ii)), the cash or deferred
arrangements included in such plans shall be treated as one arrangement. In
addition, two or more cash or deferred arrangements may be considered as a
single arrangement for purposes of determining whether or not such arrangements
satisfy Code Sections 401(a)(4), 410(b) and 401(k). In such a case, the cash or
deferred arrangements included in such plans and the plans including such
arrangements shall be treated as one arrangement and as one plan for purposes of
this Section and Code Sections 401(a)(4), 410(b) and 401(k). Plans may be
aggregated under this paragraph (e) only if they have the same plan year.

                  Notwithstanding the above, an employee stock ownership plan
described in Code Section 4975(e)(7) or 409 may not be combined with this Plan
for purposes of determining whether the employee stock ownership plan or this
Plan satisfies this Section and Code Sections 401(a)(4), 410(b) and 401(k).

         (e)      For the purposes of this Section, if a Highly Compensated
Participant is a Participant under two or more cash or deferred arrangements
(other than a cash or deferred arrangement which is part of an employee stock
ownership plan as defined in Code Section 4975(e)(7) or 409 of the Employer or
an Affiliated Employer, all such cash or deferred arrangements shall be treated
as one cash or deferred arrangement for the purpose of determining the actual
deferral ratio with respect to such Highly Compensated Participant. However, if
the cash or deferred arrangements have different plan years, this paragraph
shall be applied by treating all cash or deferred arrangements ending with or
within the same calendar year as a single arrangement.

4.6      ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS

                  In the event that the initial allocations of the Employer
Elective Contributions made pursuant to Section 4.4 do not satisfy one of the
tests set forth in Section 4.5(a), the Administrator shall adjust Excess
Contributions pursuant to the

                                       26
<PAGE>

options set forth below:

                           (a)      On or before the fifteenth day of the third
                  month following the end of each Plan Year, the Highly
                  Compensated Participant having the highest actual deferral
                  ratio shall have his portion of Excess Contributions
                  distributed to him and/or at his election recharacterized as a
                  voluntary Employee contribution pursuant to Section 4.12 until
                  one of the tests set forth in Section 4.5(a) is satisfied, or
                  until his actual deferral ratio equals the actual deferral
                  ratio of the Highly Compensated Participant having the second
                  highest actual deferral ratio. This process shall continue
                  until one of the tests set forth in Section 4.5(a) is
                  satisfied. For each Highly Compensated Participant, the amount
                  of Excess Contributions is equal to the Elective Contributions
                  used to satisfy the "Actual Deferral Percentage" tests on
                  behalf of such Highly Compensated Participant (determined
                  prior to the application of this paragraph) minus the amount
                  determined by multiplying the Highly Compensated Participant's
                  actual deferral ratio (determined after application of this
                  paragraph) by his "414(s) Compensation." However, in
                  determining the amount of Excess Contributions to be
                  distributed and/or recharacterized with respect to an affected
                  Highly Compensated Participant as determined herein, such
                  amount shall be reduced pursuant to Section 4.2(f) by any
                  Excess Deferred Compensation previously distributed to such
                  affected Highly Compensated Participant for his taxable year
                  ending with or within such Plan Year.

                           (1)      With respect to the distribution of Excess
                           Contributions pursuant to (a) above, such
                           distribution:

                                    (i)      may be postponed but not later than
                                    the close of the Plan Year following the
                                    Plan Year to which they are allocable;

                                    (ii)     shall be adjusted for Income; and

                                    (iii)    shall be designated by the Employer
                                    as a distribution of Excess Contributions
                                    (and Income).

                  (2)      With respect to the recharacterization of Excess
                  Contributions pursuant to (a) above, such recharacterized
                  amounts:

                  (i)      shall be deemed to have occurred on the date on which
                  the last of those Highly Compensated Participants with Excess
                  Contributions to be recharacterized is notified of the
                  recharacterization and the tax consequences of such
                  recharacterization;

                                       27
<PAGE>

                  (ii)     shall not exceed the amount of Deferred Compensation
                  on behalf of any Highly Compensated Participant for any Plan
                  Year;

                  (iii)    shall be treated as voluntary Employee contributions
                  for purposes of Code Section 401 (a)(4) and Regulation
                  1.401(k)-1(b). Excess Contributions recharacterized as
                  voluntary Employee contributions shall continue to be
                  nonforfeitable and subject to the same distribution rules
                  provided for in Section 4.2(c);

                  (iv)     are not permitted if the amount recharacterized plus
                  voluntary Employee contributions actually made by such Highly
                  Compensated Participant, exceed the maximum amount of
                  voluntary Employee contributions (determined prior to
                  application of Section 4.7(a)) that such Highly Compensated
                  Participant is permitted to make under the Plan in the absence
                  of recharacterization; and

                  (v)      shall be adjusted for Income.

                           (3)      Any distribution and/or recharacterization
                           of less than the entire amount of Excess
                           Contributions shall be treated as a pro rata
                           distribution and/or recharacterization of Excess
                           Contributions and Income.

                           (4)      Matching contributions which relate to
                           Excess Contributions shall be forfeited unless the
                           related matching contribution is distributed as an
                           Excess Aggregate Contribution pursuant to Section
                           4.8.

                           (b)      Within twelve (12) months after the end of
                  the Plan Year, the Employer may make a special Qualified
                  Non-Elective Contribution on behalf of Non-Highly Compensated
                  Participants electing salary reductions pursuant to Section
                  4.2 in an amount sufficient to satisfy one of the tests set
                  forth in Section 4.5(a). Such contribution shall be allocated
                  to the Participant's Elective Account of each Non-Highly
                  Compensated Participant electing salary reductions pursuant to
                  Section 4.2 in the same proportion that each such Non-Highly
                  Compensated Participant's Deferred Compensation for the year
                  bears to the total Deferred Compensation of all such
                  Non-Highly Compensated Participants.

                           (c)      If during a Plan Year the projected
                  aggregate amount of Elective Contributions to be allocated to
                  all Highly Compensated Participants under this Plan would, by
                  virtue of the tests set forth in Section 4.5(a), cause the
                  Plan to fail such tests, then the Administrator may
                  automatically reduce proportionately or in the order provided
                  in Section 4.6(a) each affected Highly Compensated
                  Participant's deferral

                                       28
<PAGE>

                  election made pursuant to Section 4.2 by an amount necessary
                  to satisfy one of the tests set forth in Section 4.5(a).

4.7      ACTUAL CONTRIBUTION PERCENTAGE TESTS

                           (a)      The "Actual Contribution Percentage" for the
                  Highly Compensated Participant group shall not exceed the
                  greater of:

                           (1)      125 percent of such percentage for the
                           Non-Highly Compensated Participant group; or

                           (2)      the lesser of 200 percent of such percentage
                           for the Non-Highly Compensated Participant group, or
                           such percentage for the Non-Highly Compensated
                           Participant group plus 2 percentage points. However,
                           to prevent the multiple use of the alternative method
                           described in this paragraph and Code Section 401
                           (m)(9)(A), any Highly Compensated Participant
                           eligible to make elective deferrals pursuant to
                           Section 4.2 or any other cash or deterred arrangement
                           maintained by the Employer or an Affiliated Employer
                           and to make Employee contributions or to receive
                           matching contributions under this Plan or under any
                           plan maintained by the Employer or an Affiliated
                           Employer shall have a combination of his actual
                           deferral ratio and his actual contribution ratio
                           reduced pursuant to Regulation 1.401 (m)-2 and
                           Section 4.8(a). The provisions of Code Section 401(m)
                           and Regulations 1.401(m)-1 (b) and 1.401 (m)-2 are
                           incorporated herein by reference.

                           (b)      For the purposes of this Section and Section
                  4.8, "Actual Contribution Percentage" for a Plan Year means,
                  with respect to the Highly Compensated Participant group and
                  Non- Highly Compensated Participant group, the average of the
                  ratios (calculated separately for each Participant in each
                  group) of:

                           (1)      the sum of Employer matching contributions
                  made pursuant to Section 4.1(b), voluntary Employee
                  contributions made pursuant to Section 4.12 and Excess
                  Contributions recharacterized as voluntary Employee
                  contributions pursuant to Section 4.6(a) on behalf of each
                  such Participant for such Plan Year; to

                           (2)      the Participant's "414(s) Compensation" for
                  such Plan Year.

                           (c)      For purposes of determining the "Actual
                  Contribution Percentage" and the amount of Excess Aggregate
                  Contributions pursuant to Section 4.8(d), only Employer
                  matching contributions contributed to the Plan prior to the
                  end of the succeeding Plan Year

                                       29
<PAGE>

                  shall be considered. In addition, the Administrator may elect
                  to take into account, with respect to Employees eligible to
                  have Employer matching contributions pursuant to Section
                  4.1(b) or voluntary Employee contributions pursuant to Section
                  4.12 allocated to their accounts, elective deferrals (as
                  defined in Regulation 1.402(g)-1(b)) and qualified
                  non-elective contributions (as defined in Code Section 401
                  (m)(4)(C)) contributed to any plan maintained by the Employer.
                  Such elective deferrals and qualified non-elective
                  contributions shall be treated as Employer matching
                  contributions subject to Regulation 1.401(m)-1(b)(5) which is
                  incorporated herein by reference. However, the Plan Year must
                  be the same as the plan year of the plan to which the elective
                  deferrals and the qualified non- elective contributions are
                  made.

                           (d)      For purposes of this Section and Code
                  Sections 401 (a)(4), 410(b) and 401(m), if two or more plans
                  of the Employer to which matching contributions, Employee
                  contributions, or both, are made are treated as one plan for
                  purposes of Code Sections 401 (a)(4) or 410(b) (other than the
                  average benefits test under Code Section 410(b)(2)(A)(ii)),
                  such plans shall be treated as one plan. In addition, two or
                  more plans of the Employer to which matching contributions,
                  Employee contributions, or both, are made may be considered as
                  a single plan for purposes of determining whether or not such
                  plans satisfy Code Sections 401 (a)(4), 410(b) and 401(m). In
                  such a case, the aggregated plans must satisfy this Section
                  and Code Sections 401 (a)(4), 410(b) and 401(m) as though such
                  aggregated plans were a single plan. Plans may be aggregated
                  under this paragraph (e) only if they have the same plan year.

                                    Notwithstanding the above, an employee stock
                  ownership plan described in Code Section 4975(e)(7) or 409 may
                  not be aggregated with this Plan for purposes of determining
                  whether the employee stock ownership plan or this Plan
                  satisfies this Section and Code Sections 401 (a)(4), 410(b)
                  and 401(m).

                           (e)      If a Highly Compensated Participant is a
                  Participant under two or more plans (other than an employee
                  stock ownership plan as defined in Code Section 4975(e)(7) or
                  409) which are maintained by the Employer or an Affiliated
                  Employer to which matching contributions, Employee
                  contributions, or both, are made, all such contributions on
                  behalf of such Highly Compensated Participant shall be
                  aggregated for purposes of determining such Highly Compensated
                  Participant's actual contribution ratio. However, if the plans
                  have different plan years, this paragraph shall be applied by
                  treating all plans ending with or within the same calendar
                  year as a single plan.

                           (f)      For purposes of Sections 4.7(a) and 4.8, a
                  Highly Compensated Participant and Non-Highly Compensated
                  Participant shall

                                       30
<PAGE>

                  include any Employee eligible to have Employer matching
                  contributions (whether or not a deferral election was made or
                  suspended) or voluntary employee contributions (whether or not
                  voluntary employee contributions are made) allocated to his
                  account for the Plan Year.

4.8      ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS

                           (a)      In the event that the "Actual Contribution
                  Percentage" for the Highly Compensated Participant group
                  exceeds the "Actual Contribution Percentage" for the
                  Non-Highly Compensated Participant group pursuant to Section
                  4.7(a), the Administrator (on or before the fifteenth day of
                  the third month following the end of the Plan Year, but in no
                  event later than the close of the following Plan Year) shall
                  direct the Trustee to distribute to the Highly Compensated
                  Participant having the highest actual contribution ratio, his
                  Vested portion of Excess Aggregate Contributions (and Income
                  allocable to such contributions) and, if forfeitable, forfeit
                  such non-Vested Excess Aggregate Contributions attributable to
                  Employer matching contributions (and Income allocable to such
                  forfeitures) until either one of the tests set forth in
                  Section 4.7(a) is satisfied, or until his actual contribution
                  ratio equals the actual contribution ratio of the Highly
                  Compensated Participant having the second highest actual
                  contribution ratio. This process shall continue until one of
                  the tests set forth in Section 4.7(a) is satisfied. The
                  distribution and/or forfeiture of Excess Aggregate
                  Contributions shall be made in the following order:

                           (1)      Voluntary Employee contributions including
                           Excess Contributions recharacterized as voluntary
                           Employee contributions pursuant to Section 4.6(a)(2);

                           (2)      Employer matching contributions.

                           (b)      Any distribution and/or forfeiture of less
                  than the entire amount of Excess Aggregate Contributions (and
                  Income) shall be treated as a pro rata distribution and/or
                  forfeiture of Excess Aggregate Contributions and Income.
                  Distribution of Excess Aggregate Contributions shall be
                  designated by the Employer as a distribution of Excess
                  Aggregate Contributions (and Income). Forfeitures of Excess
                  Aggregate Contributions shall be treated in accordance with
                  Section 4.4.

                           (c)      Excess Aggregate Contributions attributable
                  to amounts other than voluntary Employee contributions,
                  including forfeited matching contributions, shall be treated
                  as Employer contributions for purposes of Code Sections 404
                  and 415 even if distributed from the Plan.

                                       31
<PAGE>

                                    Forfeited matching contributions that are
                  reallocated to Participants' Accounts for the Plan Year in
                  which the forfeiture occurs shall be treated as an "annual
                  addition" pursuant to Section 4.9(b) for the Participants to
                  whose Accounts they are reallocated and for the Participants
                  from whose Accounts they are forfeited.

                           (d)      For each Highly Compensated Participant, the
                  amount of Excess Aggregate Contributions is equal to the
                  Employer matching contributions made pursuant to Section
                  4.1(b), voluntary Employee contributions made pursuant to
                  Section 4.12, Excess Contributions recharacterized as
                  voluntary Employee contributions pursuant to Section 4.6(a)
                  and any qualified non-elective contributions or elective
                  deferrals taken into account pursuant to Section 4.7(c) on
                  behalf of the Highly Compensated Participant (determined prior
                  to the application of this paragraph) minus the amount
                  determined by multiplying the Highly Compensated Participant's
                  actual contribution ratio (determined after application of
                  this paragraph) by his "414(s) Compensation." The actual
                  contribution ratio must be rounded to the nearest
                  one-hundredth of one percent. In no case shall the amount of
                  Excess Aggregate Contribution with respect to any Highly
                  Compensated Participant exceed the amount of Employer matching
                  contributions made pursuant to Section 4.1(b), voluntary
                  Employee contributions made pursuant to Section 4.12, Excess
                  Contributions recharacterized as voluntary Employee
                  contributions pursuant to Section 4.6(a) and any qualified
                  non-elective contributions or elective deferrals taken into
                  account pursuant to Section 4.7(c) on behalf of such Highly
                  Compensated Participant for such Plan Year.

                           (e)      The determination of the amount of Excess
                  Aggregate Contributions with respect to any Plan Year shall be
                  made after first determining the Excess Contributions, if any,
                  to be treated as voluntary Employee contributions due to
                  recharacterization for the plan year of any other qualified
                  cash or deferred arrangement (as defined in Code Section 401
                  (k)) maintained by the Employer that ends with or within the
                  Plan Year or which are treated as voluntary Employee
                  contributions due to recharacterization pursuant to Section
                  4.6(a).

                           (f)      If during a Plan Year the projected
                  aggregate amount of Employer matching contributions, voluntary
                  Employee contributions and Excess Contributions
                  recharacterized as voluntary Employee contributions to be
                  allocated to all Highly Compensated Participants under this
                  Plan would, by virtue of the tests set forth in Section
                  4.7(a), cause the Plan to fail such tests, then the
                  Administrator may automatically reduce proportionately or in
                  the order provided in Section 4.8(a) each affected Highly
                  Compensated Participant's projected share of such
                  contributions by an amount necessary to satisfy one of the
                  tests set forth in Section 4.7(a).

                                       32
<PAGE>

                           (g)      Notwithstanding the above, within twelve
                  (12) months after the end of the Plan Year, the Employer may
                  make a special Qualified Non-Elective Contribution on behalf
                  of Non-Highly Compensated Participants in an amount sufficient
                  to satisfy one of the tests set forth in Section 4.7(a). Such
                  contribution shall be allocated to the Participant's Account
                  of Non-Highly Compensated Participant in the same proportion
                  that each Non-Highly Compensated Participant's Compensation
                  for the Plan Year bears to the total Compensation of all
                  Non-Highly Compensated Participants for the Plan Year. A
                  separate accounting of any special Qualified Non-Elective
                  Contribution shall be maintained in the Participant's Account.

4.9      MAXIMUM ANNUAL ADDITIONS

                           (a)      Notwithstanding the foregoing, the maximum
                  "annual additions" credited to a Participant's accounts for
                  any "limitation year" shall equal the lesser of: (1) $30,000
                  adjusted annually as provided in Code Section 415(d) pursuant
                  to the Regulations, or (2) twenty-five percent (25%) of the
                  Participant's "415 Compensation" for such "limitation year."
                  For any short "limitation year," the dollar limitation in (1)
                  above shall be reduced by a fraction, the numerator of which
                  is the number of full months in the short "limitation year"
                  and the denominator of which is twelve (12).

                           (b)      For purposes of applying the limitations of
                  Code Section 415, "annual additions" means the sum credited
                  to a Participant's accounts for any "limitation year" of (1)
                  Employer contributions, (2) Employee contributions, (3)
                  forfeitures, (4) amounts allocated, after March 31, 1984, to
                  an individual medical account, as defined in Code Section
                  415(l)(2) which is part of a pension or annuity plan
                  maintained by the Employer and (5) amounts derived from
                  contributions paid or accrued after December 31, 1985, in
                  taxable years ending after such date, which are attributable
                  to post-retirement medical benefits allocated to the separate
                  account of a key employee (as defined in Code Section 41
                  9A(d)(3)) under a welfare benefit plan (as defined in Code
                  Section 419(e)) maintained by the Employer. Except, however,
                  the "415 Compensation" percentage limitation referred to in
                  paragraph (a)(2) above shall not apply to: (1) any
                  contribution for medical benefits (within the meaning of Code
                  Section 419A(f)(2)) after separation from service which is
                  otherwise treated as an "annual addition," or (2) any amount
                  otherwise treated as an "annual addition" under Code Section
                  415(l)(1).

                           (c)      For purposes of applying the limitations of
                  Code Section 415, the transfer of funds from one qualified
                  plan to another is not an "annual addition." In addition, the
                  following are not Employee contributions for the purposes of
                  Section 4.9(b)(2): (1) rollover contributions (as defined in
                  Code Sections 402(e)(6), 403(a)(4), 403(b)(8) and 408(d)(3));
                  (2) repayments of loans made to a Participant

                                       33
<PAGE>

                  from the Plan; (3) repayments of distributions received by an
                  Employee pursuant to Code Section 411(a)(7)(B) (cash-outs);
                  (4) repayments of distributions received by an Employee
                  pursuant to Code Section 411(a)(3)(D) (mandatory
                  contributions); and (5) Employee contributions to a simplified
                  employee pension excludable from gross income under Code
                  Section 408(k)(6).

                           (d)      For purposes of applying the limitations of
                  Code Section 415, the "limitation year" shall be the Plan
                  Year.

                           (e)      For the purpose of this Section, all
                  qualified defined contribution plans (whether terminated or
                  not) ever maintained by the Employer shall be treated as one
                  defined contribution plan.

                           (f)      For the purpose of this Section, if the
                  Employer is a member of a controlled group of corporations,
                  trades or businesses under common control (as defined by Code
                  Section 1563(a) or Code Section 414(b) and (c) as modified by
                  Code Section 415(h)), is a member of an affiliated service
                  group (as defined by Code Section 414(m)), or is a member of a
                  group of entities required to be aggregated pursuant to
                  Regulations under Code Section 414(o), all Employees of such
                  Employers shall be considered to be employed by a single
                  Employer.

                           (g)      For the purpose of this Section, if this
                  Plan is a Code Section 413(c) plan, each Employer who
                  maintains this Plan will be considered to be a separate
                  Employer.

                           (h)(1)   If a Participant participates in more than
                  one defined contribution plan maintained by the Employer which
                  have different Anniversary Dates, the maximum "annual
                  additions" under this Plan shall equal the maximum "annual
                  additions" for the "limitation year" minus any "annual
                  additions" previously credited to such Participant's accounts
                  during the "limitation year."

                           (2)      If a Participant participates in both a
                           defined contribution plan subject to Code Section 412
                           and a defined contribution plan not subject to Code
                           Section 412 maintained by the Employer which have the
                           same Anniversary Date, "annual additions" will be
                           credited to the Participant's accounts under the
                           defined contribution plan subject to Code Section 412
                           prior to crediting "annual additions" to the
                           Participant's accounts under the defined contribution
                           plan not subject to Code Section 412.

                           (3)      If a Participant participates in more than
                           one defined contribution plan not subject to Code
                           Section 412 maintained by the Employer which have the
                           same Anniversary Date, the maximum "annual additions"
                           under this Plan shall equal the

                                       34
<PAGE>

                           product of (A) the maximum "annual additions" for the
                           "limitation year" minus any "annual additions"
                           previously credited under subparagraphs (1) or (2)
                           above, multiplied by (B) a fraction (i) the numerator
                           of which is the "annual additions" which would be
                           credited to such Participant's accounts under this
                           Plan without regard to the limitations of Code
                           Section 415 and (ii) the denominator of which is such
                           "annual additions" for all plans described in this
                           subparagraph.

                           (i)      Notwithstanding anything contained in this
                  Section to the contrary, the limitations, adjustments and
                  other requirements prescribed in this Section shall at all
                  times comply with the provisions of Code Section 415 and the
                  Regulations thereunder, the terms of which are specifically
                  incorporated herein by reference.

4.10     ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS

                           (a)      If, as a result of a reasonable error in
                  estimating a Participant's Compensation, a reasonable error in
                  determining the amount of elective deferrals (within the
                  meaning of Code Section 402(g)(3)) that may be made with
                  respect to any Participant under the limits of Section 4.9 or
                  other facts and circumstances to which Regulation 1.4156(b)(6)
                  shall be applicable, the "annual additions" under this Plan
                  would cause the maximum "annual additions" to be exceeded for
                  any Participant, the Administrator shall

                           (1)      distribute any elective deferrals (within
                  the meaning of Code Section 402(g)(3)) or return any Employee
                  contributions (whether voluntary or mandatory), and for the
                  distribution of gains attributable to those elective deferrals
                  and Employee contributions, to the extent that the
                  distribution or return would reduce the "excess amount" in the
                  Participant's accounts

                           (2)      hold any "excess amount" remaining after the
                  return of any elective deferrals or voluntary Employee
                  contributions in a "Section 415 suspense account" (3) use the
                  "Section 415 suspense account" in the next "limitation year"
                  (and succeeding "limitation years" if necessary) to reduce
                  Employer contributions for that Participant if that
                  Participant is covered by the Plan as of the end of the
                  "limitation year," or if the Participant is not so covered,
                  allocate and reallocate the "Section 415 suspense account" in
                  the next "limitation year" (and succeeding "limitation years"
                  if necessary) to all Participants in the Plan before any
                  Employer or Employee contributions which would constitute
                  "annual additions" are made to the Plan for such "limitation
                  year" (4) reduce Employer contributions to the Plan for such
                  "limitation year" by the amount of the "Section 415 suspense
                  account" allocated and reallocated during such "limitation
                  year."

                                       35
<PAGE>

                           (b)      For purposes of this Article, "excess
                  amount" for any Participant for a "limitation year" shall mean
                  the excess, if any, of (1) the "annual additions" which would
                  be credited to his account under the terms of the Plan without
                  regard to the limitations of Code Section 415 over (2) the
                  maximum "annual additions" determined pursuant to Section 4.9.

                           (c)      For purposes of this Section, "Section 415
                  suspense account" shall mean an unallocated account equal to
                  the sum of "excess amounts" for all Participants in the Plan
                  during the "limitation year." The "Section 415 suspense
                  account" shall not share in any earnings or losses of the
                  Trust Fund.

4.11     TRANSFERS FROM QUALIFIED PLANS

                           (a)      With the consent of the Administrator,
                  amounts may be transferred from other qualified plans by
                  Eligible Employees, provided that the trust from which such
                  funds are transferred permits the transfer to be made and the
                  transfer will not jeopardize the tax exempt status of the Plan
                  or Trust or create adverse tax consequences for the Employer.
                  The amounts transferred shall be set up in a separate account
                  herein referred to as a "Participant's Rollover Account." Such
                  account shall be fully Vested at all times and shall not be
                  subject to Forfeiture for any reason.

                           (b)      Amounts in a Participant's Rollover Account
                  shall be held by the Trustee pursuant to the provisions of
                  this Plan and may not be withdrawn by, or distributed to the
                  Participant, in whole or in part, except as provided in
                  paragraphs (c) and (d) of this Section.

                           (c)      Except as permitted by Regulations
                  (including Regulation 1.411 (d)-4), amounts attributable to
                  elective contributions (as defined in Regulation 1.401 (k)-1
                  (g)(3)), including amounts treated as elective contributions,
                  which are transferred from another qualified plan in a
                  plan-to-plan transfer shall be subject to the distribution
                  limitations provided for in Regulation 1.401(k)- 1(d).

                           (d)      The Administrator, at the election of the
                  Participant, shall direct the Trustee to distribute all or a
                  portion of the amount credited to the Participant's Rollover
                  Account. Any distributions of amounts held in a Participant's
                  Rollover Account shall be made in a manner which is consistent
                  with and satisfies the provisions of Section 6.5, including,
                  but not limited to, all notice and consent requirements of
                  Code Section 411 (a)(11) and the Regulations thereunder.
                  Furthermore, such amounts shall be considered as part of a
                  Participant's benefit in determining whether an involuntary
                  cash-out of benefits without Participant consent

                                       36
<PAGE>

                  may be made.

                           (e)      The Administrator may direct that employee
                  transfers made after a Valuation Date be segregated into a
                  separate account for each Participant in a federally insured
                  savings account, certificate of deposit in a bank or savings
                  and loan association, money market certificate, or other short
                  term debt security acceptable to the Trustee until such time
                  as the allocations pursuant to this Plan have been made, at
                  which time they may remain segregated or be invested as part
                  of the general Trust Fund, to be determined by the
                  Administrator.

                           (f)      For purposes of this Section, the term
                  "qualified plan" shall mean any tax qualified plan under Code
                  Section 401(a). The term "amounts transferred from other
                  qualified plans" shall mean: (i) amounts transferred to this
                  Plan directly from another qualified plan; (ii) distributions
                  from another qualified plan which are eligible rollover
                  distributions and which are either transferred by the Employee
                  to this Plan within sixty (60) days following his receipt
                  thereof or are transferred pursuant to a direct rollover;
                  (iii) amounts transferred to this Plan from a conduit
                  individual retirement account provided that the conduit
                  individual retirement account has no assets other than assets
                  which (A) were previously distributed to the Employee by
                  another qualified plan as a lump-sum distribution (B) were
                  eligible for tax-free rollover to a qualified plan and (C)
                  were deposited in such conduit individual retirement account
                  within sixty (60) days of receipt thereof and other than
                  earnings on said assets; and (iv) amounts distributed to the
                  Employee from a conduit individual retirement account meeting
                  the requirements of clause (iii) above, and transferred by the
                  Employee to this Plan within sixty (60) days of his receipt
                  thereof from such conduit individual retirement account.

                           (g)      Prior to accepting any transfers to which
                  this Section applies, the Administrator may require the
                  Employee to establish that the amounts to be transferred to
                  this Plan meet the requirements of this Section and may also
                  require the Employee to provide an opinion of counsel
                  satisfactory to the Employer that the amounts to be
                  transferred meet the requirements of this Section.

                           (h)      This Plan shall not accept any direct or
                  indirect transfers (as that term is defined and interpreted
                  under Code Section 401 (a)(11) and the Regulations thereunder)
                  from a defined benefit plan, money purchase plan (including a
                  target benefit plan), stock bonus or profit sharing plan which
                  would otherwise have provided for a life annuity form of
                  payment to the Participant.

                           (i)      Notwithstanding anything herein to the
                  contrary, a transfer directly to this Plan from another
                  qualified plan (or a transaction having

                                       37
<PAGE>

                  the effect of such a transfer) shall only be permitted if it
                  will not result in the elimination or reduction of any
                  "Section 411 (d)(6) protected benefit" as described in Section
                  7.1.

4.12     VOLUNTARY CONTRIBUTIONS

                           (a)      In order to allow Participants the
                  opportunity to increase their retirement income, each
                  Participant may, at the discretion of the Administrator, elect
                  to voluntarily contribute a portion of his compensation earned
                  while a Participant under this Plan. Such contributions shall
                  be paid to the Trustee within a reasonable period of time but
                  in no event later than ninety (90) days after the Employer
                  receives the contribution. The balance in each Participant's
                  Voluntary Contribution Account shall be fully Vested at all
                  times and shall not be subject to Forfeiture for any reason.

                           (b)      A Participant may elect to withdraw his
                  voluntary contributions from his Voluntary Contribution
                  Account and the actual earnings thereon in a manner which is
                  consistent with and satisfies the provisions of Section 6.5,
                  including, but not limited to, all notice and consent
                  requirements of Code Section 411 (a)(11) and the Regulations
                  thereunder. If the Administrator maintains sub- accounts with
                  respect to voluntary contributions (and earnings thereon)
                  which were made on or before a specified date, a Participant
                  shall be permitted to designate which sub-account shall be the
                  source for his withdrawal.

                                    In the event such a withdrawal is made, or
                  in the event a Participant has received a hardship
                  distribution pursuant to Regulation 1.401(k)-1(d)(2)(iv)(B)
                  from any other plan maintained by the Employer, then such
                  Participant shall be barred from making any voluntary
                  contributions to the Trust Fund for a period of twelve (12)
                  months after receipt of the withdrawal or distribution.

                           (c)      At Normal Retirement Date, or such other
                  date when the Participant or his Beneficiary shall be entitled
                  to receive benefits, the fair market value of the Voluntary
                  Contribution Account shall be used to provide additional
                  benefits to the Participant or his Beneficiary.

                           (d)      The Administrator may direct that voluntary
                  contributions made after a Valuation Date be segregated into a
                  separate account for each Participant in a federally insured
                  savings account, certificate of deposit in a bank or savings
                  and loan association, money market certificate, or other short
                  term debt security acceptable to the Trustee until such time
                  as the allocations pursuant to this Plan have been made, at
                  which time they may remain segregated or be invested as part
                  of the general Trust Fund, to be determined by the
                  Administrator.

                                       38
<PAGE>

4.13     DIRECTED INVESTMENT ACCOUNT

                           (a)      Participants may, subject to a procedure
                  established by the Administrator (the Participant Direction
                  Procedures) and applied in a uniform nondiscriminatory manner,
                  direct the Trustee to invest all of their accounts in specific
                  assets, specific funds or other investments permitted under
                  the Plan and the Participant Direction Procedures. That
                  portion of the interest of any Participant so directing will
                  thereupon be considered a Participant's Directed Account.

                           (b)      As of each Valuation Date, all Participant
                  Directed Accounts shall be charged or credited with the net
                  earnings, gains, losses and expenses as well as any
                  appreciation or depreciation in the market value using
                  publicly listed fair market values when available or
                  appropriate.

                           (1)      To the extent that the assets in a
                           Participant's Directed Account are accounted for as
                           pooled assets or investments, the allocation of
                           earnings, gains and losses of each Participant's
                           Directed Account shall be based upon the total amount
                           of funds so invested, in a manner proportionate to
                           the Participant's share of such pooled investment.

                           (2)      To the extent that the assets in the
                           Participant's Directed Account are accounted for as
                           segregated assets, the allocation of earnings, gains
                           and losses from such assets shall be made on a
                           separate and distinct basis.

                           (c)      The Participant Direction Procedures shall
                  provide an explanation of the circumstances under which
                  Participants and their Beneficiaries may give investment
                  instructions, including, but need not be limited to, the
                  following:

                           (1)      the conveyance of instructions by the
                           Participants and their Beneficiaries to invest
                           Participant Directed Accounts in Directed
                           Investments;

                           (2)      the name, address and phone number of the
                           Fiduciary (and, if applicable, the person or persons
                           designated by the Fiduciary to act on its behalf)
                           responsible for providing information to the
                           Participant or a Beneficiary upon request relating to
                           the investments in Directed Investments;

                           (3)      applicable restrictions on transfers to and
                           from any Designated Investment Alternative;

                                       39
<PAGE>

                           (4)      any restrictions on the exercise of voting,
                           tender and similar rights related to a Directed
                           Investment by the Participants or their
                           Beneficiaries;

                           (5)      a description of any transaction fees and
                           expenses which affect the balances in Participant
                           Directed Accounts in connection with the purchase or
                           sale of Directed Investments; and

                           (6)      general procedures for the dissemination of
                           investment and other information relating to the
                           Designated Investment Alternatives as deemed
                           necessary or appropriate, including but not limited
                           to a description of the following:

                                    (i)      the investment vehicles available
                                    under the Plan, including specific
                                    information regarding any Designated
                                    Investment Alternative;

                                    (ii)     any designated Investment Managers;
                                    and

                                    (iii)    a description of the additional
                                    information which may be obtained upon
                                    request from the Fiduciary designated to
                                    provide such information.

                           (d)      Any information regarding investments
                  available under the Plan, to the extent not required to be
                  described in the Participant Direction Procedures, may be
                  provided to the Participant in one or more written documents
                  which are separate from the Participant Direction Procedures
                  and are not thereby incorporated by reference into this Plan.

                           (e)      The Administrator may, at its discretion,
                  include in or exclude by amendment or other action from the
                  Participant Direction Procedures such instructions, guidelines
                  or policies as it deems necessary or appropriate to ensure
                  proper administration of the Plan, and may interpret the same
                  accordingly.

                                    ARTICLE V
                                   VALUATIONS

5.1      VALUATION OF THE TRUST FUND

                  The Administrator shall direct the Trustee, as of each
Valuation Date, to determine the net worth of the assets comprising the Trust
Fund as it exists on the Valuation Date. In determining such net worth, the
Trustee shall value the assets comprising the Trust Fund at their fair market
value as of the Valuation Date and shall

                                       40
<PAGE>

deduct all expenses for which the Trustee has not yet obtained reimbursement
from the Employer or the Trust Fund. The Trustee may update the value of any
shares held in the Participant Directed Account by reference to the number of
shares held by that Participant, priced at the market value as of the Valuation
Date.

5.2      METHOD OF VALUATION

                  In determining the fair market value of securities held in the
Trust Fund which are listed on a registered stock exchange, the Administrator
shall direct the Trustee to value the same at the prices they were last traded
on such exchange preceding the close of business on the Valuation Date. If such
securities were not traded on the Valuation Date, or if the exchange on which
they are traded was not open for business on the Valuation Date, then the
securities shall be valued at the prices at which they were last traded prior to
the Valuation Date. Any unlisted security held in the Trust Fund shall be valued
at its bid price next preceding the close of business on the Valuation Date,
which bid price shall be obtained from a registered broker or an investment
banker. In determining the fair market value of assets other than securities for
which trading or bid prices can be obtained, the Trustee may appraise such
assets itself, or in its discretion, employ one or more appraisers for that
purpose and rely on the values established by such appraiser or appraisers.

                                   ARTICLE VI
                   DETERMINATION AND DISTRIBUTION OF BENEFITS

6.1      DETERMINATION OF BENEFITS UPON RETIREMENT

                  Every Participant may terminate his employment with the
Employer and retire for the purposes hereof on his Normal Retirement Date or
Early Retirement Date. However, a Participant may postpone the termination of
his employment with the Employer to a later date, in which event the
participation of such Participant in the Plan, including the right to receive
allocations pursuant to Section 4.4, shall continue until his Late Retirement
Date. Upon a Participant's termination of employment, or as soon thereafter as
is practicable, the Trustee shall distribute, at the election of the
Participant, all amounts credited to such Participant's Combined Account in
accordance with Section 6.5.

6.2      DETERMINATION OF BENEFITS UPON DEATH

                           (a)      Upon the death of a Participant before his
                  Retirement Date or other termination of his employment, all
                  amounts credited to such Participant's Combined Account shall
                  become fully Vested. The Administrator shall direct the
                  Trustee, in accordance with the provisions of Sections 6.6 and
                  6.7, to distribute the value of the deceased Participant's
                  accounts to the Participant's Beneficiary.

                                       41
<PAGE>

                           (b)      Upon the death of a Former Participant, the
                  Administrator shall direct the Trustee, in accordance with the
                  provisions of Sections 6.6 and 6.7, to distribute any
                  remaining Vested amounts credited to the accounts of a
                  deceased Former Participant to such Former Participant's
                  Beneficiary.

                           (c)      Any security interest held by the Plan by
                  reason of an outstanding loan to the Participant or Former
                  Participant shall be taken into account in determining the
                  amount of the death benefit.

                           (d)      The Administrator may require such proper
                  proof of death and such evidence of the right of any person to
                  receive payment of the value of the account of a deceased
                  Participant or Former Participant as the Administrator may
                  deem desirable. The Administrator's determination of death and
                  of the right of any person to receive payment shall be
                  conclusive.

                           (e)      The Beneficiary of the death benefit payable
                  pursuant to this Section shall be the Participant's spouse.
                  Except, however, the Participant may designate a Beneficiary
                  other than his spouse if:

                           (1)      the spouse has waived the right to be the
                           Participant's Beneficiary, or

                           (2)      the Participant is legally separated or has
                           been abandoned (within the meaning of local law) and
                           the Participant has a court order to such effect (and
                           there is no "qualified domestic relations order" as
                           defined in Code Section 414(p) which provides
                           otherwise), or

                           (3)      the Participant has no spouse, or

                           (4)      the spouse cannot be located.

                                    In such event, the designation of a
                  Beneficiary shall be made on a form satisfactory to the
                  Administrator. A Participant may at any time revoke his
                  designation of a Beneficiary or change his Beneficiary by
                  filing written notice of such revocation or change with the
                  Administrator. However, the Participant's spouse must again
                  consent in writing to any change in Beneficiary unless the
                  original consent acknowledged that the spouse had the right to
                  limit consent only to a specific Beneficiary and that the
                  spouse voluntarily elected to relinquish such right. In the
                  event no valid designation of Beneficiary exists at the time
                  of the Participant's death, the death benefit shall be payable
                  to his estate.

                           (f)      Any consent by the Participant's spouse to
                  waive any

                                       42
<PAGE>

                  rights to the death benefit must be in writing, must
                  acknowledge the effect of such waiver, and be witnessed by a
                  Plan representative or a notary public. Further, the spouse's
                  consent must be irrevocable and must acknowledge the specific
                  nonspouse Beneficiary.

6.3      DETERMINATION OF BENEFITS IN EVENT OF DISABILITY

                  In the event of a Participant's Total and Permanent Disability
prior to his Retirement Date or other termination of his employment, all amounts
credited to such Participant's Combined Account shall become fully Vested. In
the event of a Participant's Total and Permanent Disability, the Trustee, in
accordance with the provisions of Sections 6.5 and 6.7, shall distribute to such
Participant all amounts credited to such Participant's Combined Account as
though he had retired.

6.4      DETERMINATION OF BENEFITS UPON TERMINATION

                           (a)      If a Participant's employment with the
                  Employer is terminated for any reason other than death, Total
                  and Permanent Disability or retirement, such Participant shall
                  be entitled to such benefits as are provided hereinafter
                  pursuant to this Section 6.4.

                                    Distribution of the funds due to a
                  Terminated Participant shall be made on the occurrence of an
                  event which would result in the distribution had the
                  Terminated Participant remained in the employ of the Employer
                  (upon the Participant's death, Total and Permanent Disability,
                  Early or Normal Retirement). However, at the election of the
                  Participant, the Administrator shall direct the Trustee to
                  cause the entire Vested portion of the Terminated
                  Participant's Combined Account to be payable to such
                  Terminated Participant. Any distribution under this paragraph
                  shall be made in a manner which is consistent with and
                  satisfies the provisions of Section 6.5, including, but not
                  limited to, all notice and consent requirements of Code
                  Section 411(a)(11) and the Regulations thereunder.

                                    If the value of a Terminated Participant's
                  Vested benefit derived from Employer and Employee
                  contributions does not exceed $5,000 ($3,500 for Plan Years
                  beginning prior to August 6,1997), the Administrator shall
                  direct the Trustee to cause the entire Vested benefit to be
                  paid to such Participant in a single lump sum.

                           (b)      A Participant shall become fully Vested in
                  his Participant's Account attributable to Employer matching
                  contributions made pursuant to Section 4.1(b) immediately upon
                  entry into the Plan.

                           (c)      Notwithstanding the vesting schedule above,
                  the Vested percentage of a Participant's Account shall not be
                  less than the Vested percentage attained as of the later of
                  the effective date or adoption date

                                       43
<PAGE>

                  of this amendment and restatement.

                           (d)      Notwithstanding the vesting schedule above,
                  upon the complete discontinuance of the Employer contributions
                  to the Plan or upon any full or partial termination of the
                  Plan, all amounts credited to the account of any affected
                  Participant shall become 100% Vested and shall not thereafter
                  be subject to Forfeiture.

                           (e)      The computation of a Participant's
                  nonforfeitable percentage of his interest in the Plan shall
                  not be reduced as the result of any direct or indirect
                  amendment to this Plan. In the event that the Plan is amended
                  to change or modify any vesting schedule, a Participant with
                  at least three (3) Years of Service as of the expiration date
                  of the election period may elect to have his nonforfeitable
                  percentage computed under the Plan without regard to such
                  amendment. If a Participant fails to make such election, then
                  such Participant shall be subject to the new vesting schedule.
                  The Participant's election period shall commence on the
                  adoption date of the amendment and shall end 60 days after the
                  latest of:

                           (1)      the adoption date of the amendment,

                           (2)      the effective date of the amendment, or

                           (3)      the date the Participant receives written
                            notice of the amendment from the Employer or
                            Administrator.

         (f)(1)   If any Former Participant shall be reemployed by the Employer
         before a 1-Year Break in Service occurs, he shall continue to
         participate in the Plan in the same manner as if such termination had
         not occurred.

         (2)      If any Former Participant shall be reemployed by the Employer
         before five (5) consecutive 1-Year Breaks in Service, and such Former
         Participant had received a distribution of his entire Vested interest
         prior to his reemployment, his forfeited account shall be reinstated
         only if he repays the full amount distributed to him before the earlier
         of five (5) years after the first date on which the Participant is
         subsequently reemployed by the Employer or the close of the first
         period of five (5) consecutive 1-Year Breaks in Service commencing
         after the distribution. In the event the Former Participant does repay
         the full amount distributed to him, the undistributed portion of the
         Participant's Account must be restored in full, unadjusted by any gains
         or losses occurring subsequent to the Valuation Date coinciding with or
         preceding his termination. The source for such reinstatement shall
         first be any Forfeitures occurring during the year. If such source is
         insufficient, then the Employer shall contribute an amount which is
         sufficient to restore any such forfeited Accounts provided, however,
         that if a discretionary contribution is

                                       44
<PAGE>

         made for such year pursuant to Section 4.1(d), such contribution shall
         first be applied to restore any such Accounts and the remainder shall
         be allocated in accordance with Section 4.4.

         (3)      If any Former Participant is reemployed after a 1-Year Break
         in Service has occurred, of Service shall include of Service prior to
         his 1-Year Break in Service subject to the following rules:

                  (i)      If a Former Participant has a 1-Year Break in
                  Service, his pre- break and post-break service shall be used
                  for computing of Service for eligibility and for vesting
                  purposes only after he has been employed for one (1) of
                  Service following the date of his reemployment with the
                  Employer;

                  (ii)     Any Former Participant who under the Plan does not
                  have a nonforfeitable right to any interest in the Plan
                  resulting from Employer contributions shall lose credits
                  otherwise allowable under (i) above if his consecutive 1-Year
                  Breaks in Service equal or exceed the greater of (A) five (5)
                  or (B) the aggregate number of his pre-break of Service;

                  (iii)    After five (5) consecutive 1-Year Breaks in Service,
                  a Former Participant's Vested Account balance attributable to
                  pre-break service shall not be increased as a result of
                  post-break service;

                  (iv)     If a Former Participant is reemployed by the
                  Employer, he shall participate in the Plan immediately on his
                  date of reemployment;

                  (v)      If a Former Participant (a 1-Year Break in Service
                  previously occurred, but employment had not terminated) is
                  credited with an Hour of Service after the first eligibility
                  computation period in which he incurs a 1-Year Break in
                  Service, he shall participate in the Plan immediately.

                           (g)      In determining of Service for purposes of
                  vesting under the Plan, of Service prior to the Effective Date
                  of the Planshall be excluded.

6.5      DISTRIBUTION OF BENEFITS

                           (a) The Administrator, pursuant to the election of
                  the Participant, shall direct the Trustee to distribute to a
                  Participant or his Beneficiary any amount to which he is
                  entitled under the Plan in one or more of the following
                  methods:

                           (1)      One lump-sum payment in cash.

                           (2)      Payments over a period certain in monthly,
                           quarterly, semiannual, or annual cash installments.
                           In order to provide such

                                       45
<PAGE>

                           installment payments, the Administrator may (A)
                           segregate the aggregate amount thereof in a separate,
                           federally insured savings account, certificate of
                           deposit in a bank or savings and loan association,
                           money market certificate or other liquid short-term
                           security or (B) purchase a nontransferable annuity
                           contract for a term certain (with no life
                           contingencies) providing for such payment. The period
                           over which such payment is to be made shall not
                           extend beyond the Participant's life expectancy (or
                           the life expectancy of the Participant and his
                           designated Beneficiary).

                           (b)      Any distribution to a Participant who has a
                  benefit which exceeds $5,000 ($3,500 for Plan Years beginning
                  prior to August 6, 1997) shall require such Participant's
                  consent if such distribution commences prior to the later of
                  his Normal Retirement Age or age 62. However, if a Participant
                  has begun to receive distributions pursuant to an optional
                  form of benefit under which at least One scheduled periodic
                  distribution has not yet been made, and if the value of the
                  Participant's benefit, determined at the time of the first
                  distribution under that optional form of benefit, exceeded
                  $5,000 ($3,500 for Plan Years beginning prior to August
                  6,1997), then the value of the Participant's benefit is deemed
                  to continue to exceed such amount. With regard to this
                  required consent:

                           (1)      The Participant must be informed of his
                           right to defer receipt of the distribution. If a
                           Participant fails to consent, it shall be deemed an
                           election to defer the commencement of payment of any
                           benefit. However, any election to defer the receipt
                           of benefits shall not apply with respect to
                           distributions which are required under Section
                           6.5(c).

                           (2)      Notice of the rights specified under this
                           paragraph shall be provided no less than 30 days and
                           no more than 90 days before the date the distribution
                           commences.

                           (3)      Consent of the Participant to the
                           distribution must not be made before the Participant
                           receives the notice and must not be made more than 90
                           days before the date the distribution commences.

                           (4)      No consent shall be valid if a significant
                           detriment is imposed under the Plan on any
                           Participant who does not consent to the distribution.

         Any such distribution may commence less than 30 days after the notice
required under Regulation 1.411(a)-11(c) is given, provided that:

                                       46
<PAGE>

         (1)      Administrator clearly informs the Participant that the
Participant has a right to a period of at least 30 days after receiving the
notice to consider the decision of whether or not to elect a distribution (and,
if applicable, a particular distribution option), and (2) the Participant, after
receiving the notice, affirmatively elects a distribution.

         (c)      Notwithstanding any provision in the Plan to the contrary, for
Plan Years beginning after December 31, 1996, the distribution of a
Participant's benefits shall be made in accordance with the following
requirements and shall otherwise comply with Code Section 401 (a)(9) and the
Regulations thereunder (including Regulation 1.401 (a)(9)-2), the provisions of
which are incorporated herein by reference:

         Alternatively, distributions to a Participant must begin no later than
         the applicable April 1st as determined under the preceding paragraph
         and must be made over a period certain measured by the life expectancy
         of the Participant (or the life expectancies of the Participant and his
         designated Beneficiary) in accordance with Regulations.

         (1)      Distributions to a Participant and his Beneficiaries shall
         only be made in accordance with the incidental death benefit
         requirements of Code Section 401 (a)(9)(G) and the Regulations
         thereunder.

         (d)      For purposes of this Section, the life expectancy of a
Participant and a Participant's spouse shall be redetermined annually in
accordance with Regulations. Life expectancy and joint and last survivor
expectancy shall be computed using the return multiples in Tables V and VI of
Regulation 1.72-9.

         (e)      All annuity Contracts under this Plan shall be
non-transferable when distributed. Furthermore, the terms of any annuity
Contract purchased and distributed to a Participant or spouse shall comply with
all of the requirements of the Plan.

6.6      DISTRIBUTION OF BENEFITS UPON DEATH

                           (a)(1)   The death benefit payable pursuant to
                  Section 6.2 shall be paid to the Participant's Beneficiary
                  within a reasonable time after the Participant's death by
                  either of the following methods, as elected by the Participant
                  (or if no election has been made prior to the Participant's
                  death, by his Beneficiary) subject, however, to the rules
                  specified in Section 6.6(b):

                                    (i)      One lump-sum payment in cash.

                                    (ii)     Payment in monthly, quarterly,
                                    semi-annual, or annual cash installments
                                    over a period to be determined by the
                                    Participant or his Beneficiary. After
                                    periodic installments commence, the
                                    Beneficiary shall have the right to direct
                                    the

                                       47
<PAGE>

                                    Trustee to reduce the period over which such
                                    periodic installments shall be made, and the
                                    Trustee shall adjust the cash amount of such
                                    periodic installments accordingly.

                           (2)      In the event the death benefit payable
                           pursuant to Section 6.2 is payable in installments,
                           then, upon the death of the Participant, the
                           Administrator may direct the Trustee to segregate the
                           death benefit into a separate account, and the
                           Trustee shall invest such segregated account
                           separately, and the funds accumulated in such account
                           shall be used for the payment of the installments.

                           (b)      Notwithstanding any provision in the Plan to
                  the contrary, distributions upon the death of a Participant
                  shall be made in accordance with the following requirements
                  and shall otherwise comply with Code Section 401 (a)(9) and
                  the Regulations thereunder. If it is determined pursuant to
                  Regulations that the distribution of a Participant's interest
                  has begun and the Participant dies before his entire interest
                  has been distributed to him, the remaining portion of such
                  interest shall be distributed at least as rapidly as under the
                  method of distribution selected pursuant to Section 6.5 as of
                  his date of death. If a Participant dies before he has begun
                  to receive any distributions of his interest under the Plan or
                  before distributions are deemed to have begun pursuant to
                  Regulations, then his death benefit shall be distributed to
                  his Beneficiaries by December 31st of the calendar year in
                  which the fifth anniversary of his date of death occurs.

                                    However, the 5-year distribution requirement
                  of the preceding paragraph shall not apply to any portion of
                  the deceased Participant's interest which is payable to or for
                  the benefit of a designated Beneficiary. In such event, such
                  portion shall be distributed over a period not extending
                  beyond the life expectancy of such designated Beneficiary
                  provided such distribution begins not later than December 31st
                  of the calendar year immediately following the calendar year
                  in which the Participant died. However, in the event the
                  Participant's spouse (determined as of the date of the
                  Participant's death) is his Beneficiary, the requirement that
                  distributions commence within one year of a Participant's
                  death shall not apply. In lieu thereof, distributions must
                  commence on or before the later of: (1) December 31st of the
                  calendar year immediately following the calendar year in which
                  the Participant died; or (2) December 31st of the calendar
                  year in which the Participant would have attained age 70 1/2.
                  If the surviving spouse dies before distributions to such
                  spouse begin, then the 5-year distribution requirement of this
                  Section shall apply as if the spouse was the Participant.

                           (c)      For purposes of this Section, the life
                  expectancy of a Participant and a Participant's spouse shall
                  be redetermined annually in

                                       48
<PAGE>

                  accordance with Regulations. Life expectancy and joint and
                  last survivor expectancy shall be computed using the return
                  multiples in Tables V and VI of Regulation 1.72-9.

6.7      TIME OF SEGREGATION OR DISTRIBUTION

                  Except as limited by Sections 6.5 and 6.6, whenever the
Trustee is to make a distribution or to commence a series of payments the
distribution or series of payments may be made or begun as soon as is
practicable. However, unless a Former Participant elects in writing to defer the
receipt of benefits (such election may not result in a death benefit that is
more than incidental), the payment of benefits shall begin not later than the
60th day after the close of the Plan Year in which the latest of the following
events occurs: (a) the date on which the Participant attains the earlier of age
65 or the Normal Retirement Age specified herein; (b) the 10th anniversary of
the year in which the Participant commenced participation in the Plan; or (c)
the date the Participant terminates his service with the Employer.

6.8      DISTRIBUTION FOR MINOR BENEFICIARY

                  In the event a distribution is to be made to a minor, then the
Administrator may direct that such distribution be paid to the legal guardian,
or if none, to a parent of such Beneficiary or a responsible adult with whom the
Beneficiary maintains his residence, or to the custodian for such Beneficiary
under the Uniform Gift to Minors Act or Gift to Minors Act, if such is permitted
by the laws of the state in which said Beneficiary resides. Such a payment to
the legal guardian, custodian or parent of a minor Beneficiary shall fully
discharge the Trustee, Employer, and Plan from further liability on account
thereof.

6.9      LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN

                  In the event that all, or any portion, of the distribution
payable to a Participant or his Beneficiary hereunder shall, at the later of the
Participant's attainment of age 62 or his Normal Retirement Age, remain unpaid
solely by reason of the inability of the Administrator, after sending a
registered letter, return receipt requested, to the last known address, and
after further diligent effort, to ascertain the whereabouts of such Participant
or his Beneficiary, the amount so distributable shall be treated as a Forfeiture
pursuant to the Plan. In the event a Participant or Beneficiary is located
subsequent to his benefit being reallocated, such benefit shall be restored
unadjusted for earnings or losses.

6.10     PRE-RETIREMENT DISTRIBUTION

                  At such time as a Participant shall have attained the age of
59 1/2 years, the Administrator, at the election of the Participant, shall
direct the Trustee to distribute all or a portion of the Vested amount then
credited to the accounts maintained on behalf of the Participant. In the event
that the Administrator makes

                                       49
<PAGE>

such a distribution, the Participant shall continue to be eligible to
participate in the Plan on the same basis as any other Employee. Any
distribution made pursuant to this Section shall be made in a manner consistent
with Section 6.5, including, but not limited to, all notice and consent
requirements of Code Section 411 (a)(11) and the Regulations thereunder.

                  Notwithstanding the above, pre-retirement distributions from a
Participant's Elective Account shall not be permitted prior to the Participant
attaining age 59 1/2 except as otherwise permitted under the terms of the Plan.

6.11     ADVANCE DISTRIBUTION FOR HARDSHIP

                  (a)      The Administrator, at the election of the
         Participant, shall direct the Trustee to distribute to any Participant
         in any one Plan Year up to the lesser of 100% of his Participant's
         Elective Account valued as of the last Valuation Date or the amount
         necessary to satisfy the immediate and heavy financial need of the
         Participant. Any distribution made pursuant to this Section shall be
         deemed to be made as of the first day of the Plan Year or, if later,
         the Valuation Date immediately preceding the date of distribution, and
         the Participant's Elective Account shall be reduced accordingly.
         Withdrawal under this Section is deemed to be on account of an
         immediate and heavy financial need of the Participant if the withdrawal
         is for:

                  (1)      Expenses for medical care described in Code Section
                  213(d) previously incurred by the Participant, his spouse, or
                  any of his dependents (as defined in Code Section 152) or
                  necessary for these persons to obtain medical care;

                  (2)      The costs directly related to the purchase of a
                  principal residence for the Participant (excluding mortgage
                  payments);

                  (3)      Funeral expenses for a member of the Participant's
                  family;

                  (4)      Payment of tuition, related educational fees, and
                  room and board expenses for the next twelve (12) months of
                  post- secondary education for the Participant, his spouse,
                  children, or dependents; or

                  (5)      Payments necessary to prevent the eviction of the
                  Participant from his principal residence or foreclosure on the
                  mortgage of the Participant's principal residence.

                  (b)      No distribution shall be made pursuant to this
         Section unless the Administrator determines, based upon all relevant
         facts and circumstances that the amount to be distributed is not in
         excess of the

                                       50
<PAGE>

         amount required to relieve the financial need and that such need cannot
         be satisfied from other resources reasonably available to the
         Participant. For this purpose, the Participant's resources shall be
         deemed to include those assets of his spouse and minor children that
         are reasonably available to the Participant. The amount of the
         immediate and heavy financial need may include any amounts necessary to
         pay any federal, state or local income taxes or penalties reasonably
         anticipated to result from the distribution. A distribution may be
         treated as necessary to satisfy a financial need if the Administrator
         relies upon the Participant's representation that the need cannot be
         relieved:

                  (1)      Through reimbursement or compensation by insurance or
                  otherwise;

                  (2)      By reasonable liquidation of the Participant's
                  assets, to the extent such liquidation would not itself
                  increase the amount of the need;

                  (3)      By cessation of elective deferrals and voluntary
                  Employee contributions under the Plan; or

                  (4)      By other distributions or loans from the Plan or any
                  other qualified retirement plan, or by borrowing from
                  commercial sources on reasonable commercial terms, to the
                  extent such amounts would not themselves increase the amount
                  of the need.

                  (c)      Notwithstanding the above, distributions from the
         Participant's Elective Account pursuant to this Section shall be
         limited, as of the date of distribution, to the Participant's Elective
         Account as of the end of the last Plan Year ending before July 1, 1989,
         plus the total Participant's Deferred Compensation after such date,
         reduced by the amount of any previous distributions pursuant to this
         Section and Section 6.10.

                  (d)      Any distribution made pursuant to this Section shall
         be made in a manner which is consistent with and satisfies the
         provisions of Section 6.5, including, but not limited to, all notice
         and consent requirements of Code Section 411 (a)(11) and the
         Regulations thereunder.

6.12     QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION

                  All rights and benefits, including elections, provided to a
Participant in this Plan shall be subject to the rights afforded to any
"alternate payee" under a "qualified domestic relations order." Furthermore, a
distribution to an "alternate payee" shall be permitted if such distribution is
authorized by a "qualified domestic

                                       51
<PAGE>

relations order," even if the affected Participant has not separated from
service and has not reached the "earliest retirement age" under the Plan. For
the purposes of this Section, "alternate payee," "qualified domestic relations
order" and "earliest retirement age" shall have the meaning set forth under Code
Section 414(p).

6.13     DIRECT ROLLOVER

                           (a)      Notwithstanding any provision of the Plan to
                  the contrary that would otherwise limit a distributee's
                  election under this Section, a distributee may elect, at the
                  time and in the manner prescribed by the Administrator, to
                  have any portion of an eligible rollover distribution that is
                  equal to at least $500 paid directly to an eligible retirement
                  plan specified by the distributee in a direct rollover.

                           (b)      For purposes of this Section the following
                  definitions shall apply:

                           (1)      An eligible rollover distribution is any
                           distribution of all or any portion of the balance to
                           the credit of the distributee, except that an
                           eligible rollover distribution does not include: any
                           distribution that is one of a series of substantially
                           equal periodic payments (not less frequently than
                           annually) made for the life (or life expectancy) of
                           the distributee or the joint lives (or joint life
                           expectancies) of the distributee and the
                           distributee's designated beneficiary, or for a
                           specified period of ten years or more; any
                           distribution to the extent such distribution is
                           required under Code Section 401 (a)(9); the portion
                           of any other distribution that is not includible in
                           gross income (determined without regard to the
                           exclusion for net unrealized appreciation with
                           respect to employer securities); any hardship
                           distribution described in Code Section 401
                           (k)(2)(B)(i)(IV); and any other distribution that is
                           reasonably expected to total less than $200 during a
                           year.

                           (2)      An eligible retirement plan is an individual
                           retirement account described in Code Section 408(a),
                           an individual retirement annuity described in Code
                           Section 408(b), an annuity plan described in Code
                           Section 403(a), or a qualified trust described in
                           Code Section 401(a), that accepts the distributee's
                           eligible rollover distribution. However, in the case
                           of an eligible rollover distribution to the surviving
                           spouse, an eligible retirement plan is an individual
                           retirement account or individual retirement annuity.

                           (3)      A distributee includes an Employee or former
                           Employee. In addition, the Employee's or former
                           Employee's surviving spouse and the Employee's or
                           former Employee's spouse or former spouse who is the
                           alternate payee under a qualified domestic

                                       52
<PAGE>

                           relations order, as defined in Code Section 414(p),
                           are distributees with regard to the interest of the
                           spouse or former spouse.

                           (4)      A direct rollover is a payment by the Plan
                           to the eligible retirement plan specified by the
                           distributee.

6.14     ELIMINATION OF LOOKBACK RULE

                   Notwithstanding anything in this Article to the contrary, the
"lookback rule" (the "lookback rule" provides that for purposes of determining
whether a distribution may be made without consent, if the value at the time of
a prior distribution exceeded the applicable dollar threshold (e.g., $5,000)
then the value at any subsequent time is deemed to exceed the threshold) will
not apply to any distributions made on or after October 17, 2000.

                                   ARTICLE VII
                    AMENDMENT, TERMINATION, MERGERS AND LOANS

7.1      AMENDMENT

                           (a)      The Employer shall have the right at any
                  time to amend the Plan, subject to the limitations of this
                  Section. However, any amendment which affects the rights,
                  duties or responsibilities of the Trustee and Administrator,
                  other than an amendment to remove the Trustee or
                  Administrator, may only be made with the Trustee's and
                  Administrator's written consent. Any such amendment shall
                  become effective as provided therein upon its execution. The
                  Trustee shall not be required to execute any such amendment
                  unless the Trust provisions contained herein are a part of the
                  Plan and the amendment affects the duties of the Trustee
                  hereunder.

                           (b)      No amendment to the Plan shall be effective
                  if it authorizes or permits any part of the Trust Fund (other
                  than such part as is required to pay taxes and administration
                  expenses) to be used for or diverted to any purpose other than
                  for the exclusive benefit of the Participants or their
                  Beneficiaries or estates; or causes any reduction in the
                  amount credited to the account of any Participant; or causes
                  or permits any portion of the Trust Fund to revert to or
                  become property of the Employer.

                           (c)      Except as permitted by Regulations, no Plan
                  amendment or transaction having the effect of a Plan amendment
                  (such as a merger, plan transfer or similar transaction) shall
                  be effective to the

                                       53
<PAGE>

                  extent it eliminates or reduces any "Section 411 (d)(6)
                  protected benefit" or adds or modifies conditions relating to
                  "Section 411 (d)(6) protected benefits" the result of which is
                  a further restriction on such benefit unless such protected
                  benefits are preserved with respect to benefits accrued as of
                  the later of the adoption date or effective date of the
                  amendment. "Section 411 (d)(6) protected benefits" are
                  benefits described in Code Section 411 (d)(6)(A), early
                  retirement benefits and retirement-type subsidies, and
                  optional forms of benefit.

7.2      TERMINATION

                           (a)      The Employer shall have the right at any
                  time to terminate the Plan by delivering to the Trustee and
                  Administrator written notice of such termination. Upon any
                  full or partial termination, all amounts credited to the
                  affected Participants' Combined Accounts shall become 100%
                  Vested as provided in Section 6.4 and shall not thereafter be
                  subject to forfeiture, and all unallocated amounts shall be
                  allocated to the accounts of all Participants in accordance
                  with the provisions hereof.

                           (b)      Upon the full termination of the Plan, the
                  Employer shall direct the distribution of the assets of the
                  Trust Fund to Participants in a manner which is consistent
                  with and satisfies the provisions of Section 6.5.
                  Distributions to a Participant shall be made in cash or
                  through the purchase of irrevocable nontransferable deferred
                  commitments from an insurer. Except as permitted by
                  Regulations, the termination of the Plan shall not result in
                  the reduction of "Section 411 (d)(6) protected benefits" in
                  accordance with Section 7.1(c).

7.3      MERGER OR CONSOLIDATION

                  This Plan may be merged or consolidated with, or its assets
and/or liabilities may be transferred to any other plan and trust only if the
benefits which would be received by a Participant of this Plan, in the event of
a termination of the plan immediately after such transfer, merger or
consolidation, are at least equal to the benefits the Participant would have
received if the Plan had terminated immediately before the transfer, merger or
consolidation, and such transfer, merger or consolidation does not otherwise
result in the elimination or reduction of any "Section 411 (d)(6) protected
benefits" in accordance with Section 7.1(c).

7.4      LOANS TO PARTICIPANTS

                           (a)      The Trustee may, in the Trustee's
                  discretion, make loans to Participants and Beneficiaries under
                  the following circumstances: (1) loans shall be made available
                  to all Participants and Beneficiaries on a reasonably
                  equivalent basis; (2) loans shall not be made available to
                  Highly Compensated Employees in an amount greater than the
                  amount

                                       54
<PAGE>

                  made available to other Participants and Beneficiaries; (3)
                  loans shall bear a reasonable rate of interest; (4) loans
                  shall be adequately secured; and (5) shall provide for
                  repayment over a reasonable period of time.

                           (b)      Loans made pursuant to this Section (when
                  added to the outstanding balance of all other loans made by
                  the Plan to the Participant) shall be limited to the lesser
                  of:

                           (1)      $50,000 reduced by the excess (if any) of
                           the highest outstanding balance of loans from the
                           Plan to the Participant during the one year period
                           ending on the day before the date on which such loan
                           is made, over the outstanding balance of loans from
                           the Plan to the Participant on the date on which such
                           loan was made, or

                           (2)      one-half (1/2) of the present value of the
                           non-forfeitable accrued benefit of the Participant
                           under the Plan.

                  For purposes of this limit, all plans of the Employer shall be
considered one plan. Additionally, with respect to any loan made prior to
January 1, 1987, the $50,000 limit specified in (1) above shall be unreduced.

                           (c)      Loans shall provide for level amortization
                  with payments to be made not less frequently than quarterly
                  over a period not to exceed five (5) years. However, loans
                  used to acquire any dwelling unit which, within a reasonable
                  time, is to be used (determined at the time the loan is made)
                  as a principal residence of the Participant shall provide for
                  periodic repayment over a reasonable period of time that may
                  exceed five (5) years. For this purpose, a principal residence
                  has the same meaning as a principal residence under Code
                  Section 1034. Notwithstanding the foregoing, loans made prior
                  to January 1, 1987 which are used to acquire, construct,
                  reconstruct or substantially rehabilitate any dwelling unit
                  which, within a reasonable period of time is to be used
                  (determined at the time the loan is made) as a principal
                  residence of the Participant or a member of his family (within
                  the meaning of Code Section 267(c)(4)) may provide for
                  periodic repayment over a reasonable period of time that may
                  exceed five (5) years. Additionally, loans made prior to
                  January 1,1987, may provide for periodic payments which are
                  made less frequently than quarterly and which do not
                  necessarily result in level amortization. Loan repayments will
                  be suspended under this Plan as permitted under Code Section
                  414(u)(4).

                                       55
<PAGE>

                           (d)      Any loans granted or renewed on or after the
                  last day of the first Plan Year beginning after December 31,
                  1988 shall be made pursuant to a Participant loan program.
                  Such loan program shall be established in writing and must
                  include, but need not be limited to, the following:

                           (1)      the identity of the person or positions
                           authorized to administer the Participant loan
                           program;

                           (2)      a procedure for applying for loans;

                           (3)      the basis on which loans will be approved or
                           denied;

                           (4)      limitations, if any, on the types and
                           amounts of loans offered;

                           (5)      the procedure under the program for
                           determining a reasonable rate of interest;

                           (6)      the types of collateral which may secure a
                           Participant loan; and

                           (7)      the events constituting default and the
                           steps that will be taken to preserve Plan assets.

                  Such Participant loan program shall be contained in a separate
                  written document which, when properly executed, is hereby
                  incorporated by reference and made a part of the Plan.
                  Furthermore, such Participant loan program may be modified or
                  amended in writing from time to time without the necessity of
                  amending this Section.

                                  ARTICLE VIII
                                  MISCELLANEOUS

8.1      PARTICIPANT'S RIGHTS

                  This Plan shall not be deemed to constitute a contract between
the Employer and any Participant or to be a consideration or an inducement for
the employment of any Participant or Employee. Nothing contained in this Plan
shall be deemed to give any Participant or Employee the right to be retained in
the service of the Employer or to interfere with the right of the Employer to
discharge any Participant or Employee at any time regardless of the effect which
such discharge shall have upon him as a Participant of this Plan.

                                       56
<PAGE>

8.2      ALIENATION

                           (a)      Subject to the exceptions provided below, no
                  benefit which shall be payable out of the Trust Fund to any
                  person (including a Participant or his Beneficiary) shall be
                  subject in any manner to anticipation, alienation, sale,
                  transfer, assignment, pledge, encumbrance, or charge, and any
                  attempt to anticipate, alienate, sell, transfer, assign,
                  pledge, encumber, or charge the same shall be void; and no
                  such benefit shall in any manner be liable for, or subject to,
                  the debts, contracts, liabilities, engagements, or torts of
                  any such person, nor shall it be subject to attachment or
                  legal process for or against such person, and the same shall
                  not be recognized by the Trustee, except to such extent as may
                  be required by law.

                           (b)      This provision shall not apply to the extent
                  a Participant or Beneficiary is indebted to the Plan, as a
                  result of a loan from the Plan. At the time a distribution is
                  to be made to or for a Participant's or Beneficiary's benefit,
                  such proportion of the amount distributed as shall equal such
                  loan indebtedness shall be paid by the Trustee to the Trustee
                  or the Administrator, at the direction of the Administrator,
                  to apply against or discharge such loan indebtedness. Prior to
                  making a payment, however, the Participant or Beneficiary must
                  be given written notice by the Administrator that such loan
                  indebtedness is to be so paid in whole or part from his
                  Participant's Combined Account. If the Participant or
                  Beneficiary does not agree that the loan indebtedness is a
                  valid claim against his Vested Participant's Combined Account,
                  he shall be entitled to a review of the validity of the claim
                  in accordance with procedures provided in Sections 2.7 and
                  2.8.

                           (c)      This provision shall not apply to a
                  "qualified domestic relations order" defined in Code Section
                  414(p), and those other domestic relations orders permitted to
                  be so treated by the Administrator under the provisions of the
                  Retirement Equity Act of 1984. The Administrator shall
                  establish a written procedure to determine the qualified
                  status of domestic relations orders and to administer
                  distributions under such qualified orders. Further, to the
                  extent provided under a "qualified domestic relations order,"
                  a former spouse of a Participant shall be treated as the
                  spouse or surviving spouse for all purposes under the Plan.

8.3      CONSTRUCTION OF PLAN

                  This Plan shall be construed and enforced according to the Act
and the laws of the State of New York, other than its laws respecting choice of
law, to the extent not preempted by the Act.

                                       57
<PAGE>

8.4      GENDER AND NUMBER

                  Wherever any words are used herein in the masculine, feminine
or neuter gender, they shall be construed as though they were also used in
another gender in all cases where they would so apply, and whenever any words
are used herein in the singular or plural form, they shall be construed as
though they were also used in the other form in all cases where they would so
apply.

8.5      LEGAL ACTION

                  In the event any claim, suit, or proceeding is brought
regarding the Trust and/or Plan established hereunder to which the Trustee, the
Employer or the Administrator may be a party, and such claim, suit, or
proceeding is resolved in favor of the Trustee, the Employer or the
Administrator, they shall be entitled to be reimbursed from the Trust Fund for
any and all costs, attorney's fees, and other expenses pertaining thereto
incurred by them for which they shall have become liable.

8.6      PROHIBITION AGAINST DIVERSION OF FUNDS

                           (a)      Except as provided below and otherwise
                  specifically permitted by law, it shall be impossible by
                  operation of the Plan or of the Trust, by termination of
                  either, by power of revocation or amendment, by the happening
                  of any contingency, by collateral arrangement or by any other
                  means, for any part of the corpus or income of any trust fund
                  maintained pursuant to the Plan or any funds contributed
                  thereto to be used for, or diverted to, purposes other than
                  the exclusive benefit of Participants, Retired Participants,
                  or their Beneficiaries.

                           (b)      In the event the Employer shall make an
                  excessive contribution under a mistake of fact pursuant to Act
                  Section 403(c)(2)(A), the Employer may demand repayment of
                  such excessive contribution at any time within one (1) year
                  following the time of payment and the Trustees shall return
                  such amount to the Employer within the one (1) year period.
                  Earnings of the Plan attributable to the excess contributions
                  may not be returned to the Employer but any losses
                  attributable thereto must reduce the amount so returned.

8.7      BONDING

                  Every Fiduciary, except a bank or an insurance company, unless
exempted by the Act and regulations thereunder, shall be bonded in an amount not
less than 10% of the amount of the funds such Fiduciary handles; provided,
however, that the minimum bond shall be $1,000 and the maximum bond, $500,000.
The amount of funds handled shall be determined at the beginning of each Plan
Year by the amount of funds handled by such person, group, or class to be
covered and their

                                       58
<PAGE>

predecessors, if any, during the preceding Plan Year, or if there is no
preceding Plan Year, then by the amount of the funds to be handled during the
then current year. The bond shall provide protection to the Plan against any
loss by reason of acts of fraud or dishonesty by the Fiduciary alone or in
connivance with others. The surety shall be a corporate surety company (as such
term is used in Act Section 412(a)(2)), and the bond shall be in a form approved
by the Secretary of Labor. Notwithstanding anything in the Plan to the contrary,
the cost of such bonds shall be an expense of and may, at the election of the
Administrator, be paid from the Trust Fund or by the Employer.

8.8      EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE

                  Neither the Employer, the Administrator, nor the Trustee, nor
their successors shall be responsible for the validity of any Contract issued
hereunder or for the failure on the part of the insurer to make payments
provided by any such Contract, or for the action of any person which may delay
payment or render a Contract null and void or unenforceable in whole or in part.

8.9      INSURER'S PROTECTIVE CLAUSE

                  Any insurer who shall issue Contracts hereunder shall not have
any responsibility for the validity of this Plan or for the tax or legal aspects
of this Plan. The insurer shall be protected and held harmless in acting in
accordance with any written direction of the Trustee, and shall have no duty to
see to the application of any funds paid to the Trustee, nor be required to
question any actions directed by the Trustee. Regardless of any provision of
this Plan, the insurer shall not be required to take or permit any action or
allow any benefit or privilege contrary to the terms of any Contract which it
issues hereunder, or the rules of the insurer.

8.10     RECEIPT AND RELEASE FOR PAYMENTS

                  Any payment to any Participant, his legal representative,
Beneficiary, or to any guardian or committee appointed for such Participant or
Beneficiary in accordance with the provisions of the Plan, shall, to the extent
thereof, be in full satisfaction of all claims hereunder against the Trustee and
the Employer, either of whom may require such Participant, legal representative,
Beneficiary, guardian or committee, as a condition precedent to such payment, to
execute a receipt and release thereof in such form as shall be determined by the
Trustee or Employer.

8.11     ACTION BY THE EMPLOYER

                  Whenever the Employer under the terms of the Plan is permitted
or required to do or perform any act or matter or thing, it shall be done and
performed by a person duly authorized by its legally constituted authority.

8.12     NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY

                                       59
<PAGE>

                  The "named Fiduciaries" of this Plan are (1) the Employer, (2)
the Administrator and (3) the Trustee. The named Fiduciaries shall have only
those specific powers, duties, responsibilities, and obligations as are
specifically given them under the Plan or as accepted by or assigned to them
pursuant to any procedure provided under the Plan, including but not limited to
any agreement allocating or delegating their responsibilities, the terms of
which are incorporated herein by reference. In general, unless otherwise
indicated herein or pursuant to such agreements, the Employer shall have the
duties specified in Article II hereof, as the same may be allocated or delegated
thereunder, including but not limited to the responsibility for making the
contributions provided for under Section 4.1; and shall have the authority to
appoint and remove the Trustee and the Administrator; to formulate the Plan's
"funding policy and method"; and to amend or terminate, in whole or in part, the
Plan. The Administrator shall have the responsibility for the administration of
the Plan, including but not limited to the items specified in Article II of the
Plan, as the same may be allocated or delegated thereunder. The Administrator
shall act as the named Fiduciary responsible for communicating with the
Participant according to the Participant Direction Procedures. The Trustee shall
have the responsibility of management and control of the assets held under the
Trust, except to the extent directed pursuant to Article II or with respect to
those assets, the management of which has been assigned to an Investment
Manager, who shall be solely responsible for the management of the assets
assigned to it, all as specifically provided in the Plan and any agreement with
the Trustee. Each named Fiduciary warrants that any directions given,
information furnished, or action taken by it shall be in accordance with the
provisions of the Plan, authorizing or providing for such direction, information
or action. Furthermore, each named Fiduciary may rely upon any such direction,
information or action of another named Fiduciary as being proper under the Plan,
and is not required under the Plan to inquire into the propriety of any such
direction, information or action. It is intended under the Plan that each named
Fiduciary shall be responsible for the proper exercise of its own powers,
duties, responsibilities and obligations under the Plan as specified or
allocated herein. No named Fiduciary shall guarantee the Trust Fund in any
manner against investment loss or depreciation in asset value. Any person or
group may serve in more than one Fiduciary capacity. In the furtherance of their
responsibilities hereunder, the "named Fiduciaries" shall be empowered to
interpret the Plan and Trust and to resolve ambiguities, inconsistencies and
omissions, which findings shall be binding, final and conclusive.

8.13     HEADINGS

                  The headings and subheadings of this Plan have been inserted
for convenience of reference and are to be ignored in any construction of the
provisions hereof.

8.14     APPROVAL BY INTERNAL REVENUE SERVICE

                           (a)      Notwithstanding anything herein to the
                  contrary,

                                       60
<PAGE>

                  contributions to this Plan are conditioned upon the initial
                  qualification of the Plan under Code Section 401. If the Plan
                  receives an adverse determination with respect to its initial
                  qualification, then the Plan may return such contributions to
                  the Employer within one year after such determination,
                  provided the application for the determination is made by the
                  time prescribed by law for filing the Employer's return for
                  the taxable year in which the Plan was adopted, or such later
                  date as the Secretary of the Treasury may prescribe.

                           (b)      Notwithstanding any provisions to the
                  contrary, except Sections 3.5 and 3.6, any contribution by the
                  Employer to the Trust Fund is conditioned upon the
                  deductibility of the contribution by the Employer under the
                  Code and, to the extent any such deduction is disallowed, the
                  Employer may, within one (1) year following the disallowance
                  of the deduction, demand repayment of such disallowed
                  contribution and the Trustee shall return such contribution
                  within one (1) year following the disallowance. Earnings of
                  the Plan attributable to the excess contribution may not be
                  returned to the Employer, but any losses attributable thereto
                  must reduce the amount so returned.

8.15     UNIFORMITY

                  All provisions of this Plan shall be interpreted and applied
in a uniform, nondiscriminatory manner. In the event of any conflict between the
terms of this Plan and any Contract purchased hereunder, the Plan provisions
shall control.

                                   ARTICLE IX
                             PARTICIPATING EMPLOYERS

9.1      ADOPTION BY OTHER EMPLOYERS

                  Notwithstanding anything herein to the contrary, with the
consent of the Employer and Trustee, any other corporation or entity, whether an
affiliate or subsidiary or not, may adopt this Plan and all of the provisions
hereof, and participate herein and be known as a Participating Employer, by a
properly executed document evidencing said intent and will of such Participating
Employer.

9.2      REQUIREMENTS OF PARTICIPATING EMPLOYERS

                           (a)      Each such Participating Employer shall be
                  required to use the same Trustee as provided in this Plan.

                           (b)      The Trustee may, but shall not be required
                  to, commingle, hold and invest as one Trust Fund all
                  contributions made by Participating Employers, as well as all
                  increments thereof. However, the assets of the Plan shall, on
                  an ongoing basis, be available to pay

                                       61
<PAGE>

                  benefits to all Participants and Beneficiaries under the Plan
                  without regard to the Employer or Participating Employer who
                  contributed such assets.

                           (c)      The transfer of any Participant from or to
                  an Employer participating in this Plan, whether he be an
                  Employee of the Employer or a Participating Employer, shall
                  not affect such Participant's rights under the Plan, and all
                  amounts credited to such Participant's Combined Account as
                  well as his accumulated service time with the transfer or
                  predecessor, and his length of participation in the Plan,
                  shall continue to his credit.

                           (d)      All rights and values forfeited by
                  termination of employment shall inure only to the benefit of
                  the Participants of the Employer or Participating Employer by
                  which the forfeiting Participant was employed, except if the
                  Forfeiture is for an Employee whose Employer is an Affiliated
                  Employer, then said Forfeiture shall inure to the benefit of
                  the Participants of those Employers who are Affiliated
                  Employers. Should an Employee of one ("First") Employer be
                  transferred to an associated ("Second") Employer which is an
                  Affiliated Employer, such transfer shall not cause his account
                  balance (generated while an Employee of "First" Employer) in
                  any manner, or by any amount to be forfeited. Such Employee's
                  Participant Combined Account balance for all purposes of the
                  Plan, including length of service, shall be considered as
                  though he had always been employed by the "Second" Employer
                  and as such had received contributions, forfeitures, earnings
                  or losses, and appreciation or depreciation in value of assets
                  totaling the amount so transferred.

                           (e)      Any expenses of the Trust which are to be
                  paid by the Employer or borne by the Trust Fund shall be paid
                  by each Participating Employer in the same proportion that the
                  total amount standing to the credit of all Participants
                  employed by such Employer bears to the total standing to the
                  credit of all Participants.

9.3      DESIGNATION OF AGENT

                  Each Participating Employer shall be deemed to be a party to
this Plan; provided, however, that with respect to all of its relations with the
Trustee and Administrator for the purpose of this Plan, each Participating
Employer shall be deemed to have designated irrevocably the Employer as its
agent. Unless the context of the Plan clearly indicates the contrary, the word
"Employer" shall be deemed to include each Participating Employer as related to
its adoption of the Plan.

9.4      EMPLOYEE TRANSFERS

                  It is anticipated that an Employee may be transferred between

                                       62
<PAGE>

Participating Employers, and in the event of any such transfer, the Employee
involved shall carry with him his accumulated service and eligibility. No such
transfer shall effect a termination of employment hereunder, and the
Participating Employer to which the Employee is transferred shall thereupon
become obligated hereunder with respect to such Employee in the same manner as
was the Participating Employer from whom the Employee was transferred.

9.5      PARTICIPATING EMPLOYER CONTRIBUTION

                  Any contribution subject to allocation during each Plan Year
shall be allocated only among those Participants of the Employer or
Participating Employer making the contribution, except if the contribution is
made by an Affiliated Employer, in which event such contribution shall be
allocated among all Participants of all Participating Employers who are
Affiliated Employers in accordance with the provisions of this Plan. On the
basis of the information furnished by the Administrator, the Trustee shall keep
separate books and records concerning the affairs of each Participating Employer
hereunder and as to the accounts and credits of the Employees of each
Participating Employer. The Trustee may, but need not, register Contracts so as
to evidence that a particular Participating Employer is the interested Employer
hereunder, but in the event of an Employee transfer from one Participating
Employer to another, the employing Employer shall immediately notify the Trustee
thereof.

9.6      AMENDMENT

                  Amendment of this Plan by the Employer at any time when there
shall be a Participating Employer hereunder shall only be by the written action
of each and every Participating Employer and with the consent of the Trustee
where such consent is necessary in accordance with the terms of this Plan.

9.7      DISCONTINUANCE OF PARTICIPATION

                  Any Participating Employer shall be permitted to discontinue
or revoke its participation in the Plan. At the time of any such discontinuance
or revocation, satisfactory evidence thereof and of any applicable conditions
imposed shall be delivered to the Trustee. The Trustee shall thereafter
transfer, deliver and assign Contracts and other Trust Fund assets allocable to
the Participants of such Participating Employer to such new Trustee as shall
have been designated by such Participating Employer, in the event that it has
established a separate pension plan for its Employees, provided however, that
no such transfer shall be made if the result is the elimination or reduction of
any "Section 411 (d)(6) protected benefits" in accordance with Section 7.1(c).
If no successor is designated, the Trustee shall retain such assets for the
Employees of said Participating Employer pursuant to the provisions of the
Trust. In no such event shall any part of the corpus or income of the Trust as
it relates to such Participating Employer be used for or diverted to purposes
other than for the exclusive benefit of the Employees of such Participating
Employer.

                                       63
<PAGE>

9.8      ADMINISTRATOR'S AUTHORITY

                  The Administrator shall have authority to make any and all
necessary rules or regulations, binding upon all Participating Employers and all
Participants, to effectuate the purpose of this Article.

9.9      PARTICIPATING EMPLOYER CONTRIBUTION FOR AFFILIATE

                  If any Participating Employer is prevented in whole or in part
from making a contribution to the Trust Fund which it would otherwise have made
under the Plan by reason of having no current or accumulated earnings or
profits, or because such earnings or profits are less than the contribution
which it would otherwise have made, then, pursuant to Code Section 404(a)(3)(B),
so much of the contribution which such Participating Employer was so prevented
from making may be made, for the benefit of the participating employees of such
Participating Employer, by the other Participating Employers who are members of
the same affiliated group within the meaning of Code Section 1504 to the extent
of their current or accumulated earnings or profits, except that such
contribution by each such other Participating Employer shall be limited to the
proportion of its total current and accumulated earnings or profits remaining
after adjustment for its contribution to the Plan made without regard to this
paragraph which the total prevented contribution bears to the total current and
accumulated earnings or profits of all the Participating Employers remaining
after adjustment for all contributions made to the Plan without regard to this
paragraph.

                   A Participating Employer on behalf of whose employees a
contribution is made under this paragraph shall not reimburse the contributing
Participating Employers.

                                       64
<PAGE>

                  IN WITNESS WHEREOF, this Plan has been executed the day and
year first above written.

Signed, sealed, and delivered
in the presence of:

                                                   Central Hudson Gas & Electric
                                                   Corporation

                                                   By   /s/ STEVEN V. LANT
                                                      --------------------------
                                                            EMPLOYER

   /s/ THOMAS C. BROCKS
-------------------------------
WITNESS AS TO EMPLOYER

                                                   ATTEST /s/ GLADYS L.COOPER
                                                          ----------------------
                                                              Secretary

                                                        67

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