Document:

exh10-9.htm

    PATHFINDER
BANCORP, INC.

    PATHFINDER
BANK

    CHANGE
IN CONTROL AGREEMENT

    

    

    This Agreement is made effective as of
the January 1, 2007, by and between Pathfinder Bank (the "Bank"), a New York
chartered stock savings bank, with its principal administrative office at 214
West First Street, Oswego, New York 13126-2547, jointly with Pathfinder Bancorp,
Inc, the sole stockholder of the Bank, and Melissa A. Miller (the
"Executive").  Any reference to "Company" herein shall mean Pathfinder
Bancorp, Inc. or any successor thereto. Any reference to "Employer" herein shall
mean both the Bank and the Company or any successors thereto.

    

    WHEREAS, the Employer and
Executive entered into a change in control agreement; and

    

    WHEREAS, Section 409A of the
Internal Revenue Code (“Code”), effective January 1, 2005, requires deferred
compensation arrangements, including those set forth in change in control
agreements, to comply with its provisions and restrictions and limitations on
payments of deferred compensation; and

    

    WHEREAS, Code Section 409A and
the final regulations issued thereunder in April of 2007 necessitate changes to
said change in control agreement; and

    

    WHEREAS, Executive has agreed
to such changes; and

    

    WHEREAS, the Employer believes
it is in the best interests to enter into a revised change in control agreement
(the “Agreement”) in order to provide Executive with certain benefits in the
event of a Change in Control of the Employer, as herein after defined, and
incorporate the changes required by the new tax laws.

    

    NOW, THEREFORE, in
consideration of the mutual covenants herein contained, and upon the other terms
and conditions hereinafter provided, the parties hereby agree as
follows:

    

    1.           CHANGE IN CONTROL
DEFINED

    

    For purposes of this Agreement, a
"Change in Control" of the Bank or Company shall mean a Change in Control of a
nature that (i) would be required to be reported in response to Item 5.01 of the
current report on Form 8-K, as in effect on the date hereof, pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act"); or (ii)
results in a Change in Control of the Bank or the Company within the meaning of
the Home Owners Loan Act, as amended, and applicable rules and regulations
promulgated there under, as in effect at the time of the Change in Control
(collectively, the “HOLA”); or (iii) without limitation such a Change in Control
shall be deemed to have occurred at such time as (a) any "person" (as the term
is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing 25% or more of the
combined voting power of Company's outstanding securities except for any
securities purchased by the Employer’s employee stock ownership plan or trust;
or (b) individuals who constitute the Company’s Board of Directors on the date
hereof (the "Incumbent Board") cease for any reason to constitute at least a
majority thereof, provided that any person
becoming a director subsequent to the date hereof whose election was approved by
a vote of at least three-quarters of the directors comprising the Incumbent
Board, or whose nomination for election by the Company's stockholders was
approved by the same Nominating Committee serving under an Incumbent Board,
shall be, for purposes of this clause (b), considered as though he were a member
of the Incumbent Board; or (c) a plan of reorganization, merger, consolidation,
sale of all or substantially all the assets of the Bank or the Company or
similar transaction in which the Bank or Company is not the surviving
institution occurs; or (d) a proxy statement soliciting proxies from
stockholders of the Company, by someone other than the current management of the
Company, seeking stockholder approval of a plan of reorganization, merger or
consolidation of the Company or similar transaction with one or more
corporations or financial institutions, and as a result such proxy solicitation
a plan of reorganization, merger consolidation or similar transaction involving
the Company is approved by the requisite vote of the Company’s stockholders; or
(e) a tender offer is made for 25% or more of the voting securities of the
Company and the shareholders owning beneficially or of record 25% or more of the
outstanding securities of the Company have tendered or offered to sell their
shares pursuant to such tender offer and such tendered shares have been accepted
by the tender offeror.  Notwithstanding anything to the contrary
herein, a “Change in Control” of the Bank or the Company shall not be deemed to
have occurred in the event of a conversion of Pathfinder Bancorp, MHC to stock
holding company form.

    

    2.           BENEFITS DUE TO EXECUTIVE IN THE
EVENT OF CHANGE IN CONTROL

    

    If any of the events described in
Section 1 hereof constituting a Change in Control have occurred, Executive shall
be entitled to the benefits provided in paragraphs (a), (b), (c), (d) and (e) of
this Section 2 upon his dismissal from employment within twelve (12) months of
the Change in Control (“Dismissal”). Notwithstanding any other provision of this
Agreement, a voluntary termination by the Executive shall not be deemed a
“Dismissal”, although the following actions by the employer shall be deemed a
“Dismissal”: (i) material change in Executive’s function, duties, or
responsibilities, which change would cause Executive’s position to become one of
lesser responsibility, importance or scope from the position and attributes
thereof;  (ii) relocation of Executive’s principal place of employment
by more than 30 miles from its location at the effective date of this agreement;
or, (iii) a material reduction in the benefits and prerequisites to the
Executive from those being provided as of the effective date of this Agreement,
provided that Executive provides written notice to the Employer within ninety
(90) days of the initial existence of an event described in this paragraph and
the Employer has at least thirty (30) days to remedy such events described
paragraph unless the Employer decides to waive such period and make an immediate
payment hereunder.

    

    (a)           Upon
the occurrence of a Change in Control followed by the Executive's Dismissal, the
Employer shall pay Executive, or in the event of his subsequent death, his
beneficiary or beneficiaries, or his estate, as the case may be, as severance
pay or liquidated damages, or both, a sum equal to his most recent annual base
salary, including bonuses and any other cash compensation paid to the Executive
within the most recent twelve (12) month period.  Such Payment shall
be made by the Employer on the Date of Dismissal.  Notwithstanding the
foregoing, in the event the Executive is a Specified Employee (within the
meaning of Treasury Regulations §1.409A-1(i)), then, to the extent necessary to
avoid penalties under Code Section 409A, no payment shall be made to the
Executive prior to the first day of the seventh month following the Executive’s
Date of Dismissal in excess of the “permitted amount” under Code Section
409A.  For these purposes, the “permitted amount” shall be an amount
that does not exceed two times the lesser of: (i) the sum of Executive’s
annualized compensation based upon the annual rate of pay for services provided
to the Employer for the calendar year preceding the year in which occurs the
Executive’s Date of Dismissal or (ii) the maximum amount that may be taken into
account under a tax-qualified plan pursuant to Code Section 401(a)(17) for the
calendar year in which occurs the Executive’s Date of
Dismissal.  Payment of the “permitted amount” shall be made within
thirty days following the Executive’s Date of Dismissal.  Any payment
in excess of the permitted amount shall be made to the Executive on the first
day of the seventh month following the Executive’s Date of
Dismissal.

    

    (b)           Upon
the occurrence of a Change in Control followed by the Executive's Dismissal of
employment, the Employer will cause to be continued life insurance and
non-taxable medical and dental coverage substantially identical to the coverage
maintained by the Employer for Executive prior to his
Dismissal.   Such coverage and payments shall cease upon the
expiration of twelve (12) months.

    

    (c)           Upon
the occurrence of a Change in Control, Executive shall become fully vested in
and entitled to all benefits granted to him pursuant to any stock option plan of
the Bank or Company.

    

    (d)           Upon
the occurrence of a Change in Control, Executive shall become fully vested in
and entitled to all benefits granted to him pursuant to any nonqualified
deferred compensation plan of the Bank or Company, applicable to him, if
any.

    

    (e)           Upon
the occurrence of a Change in Control, the Executive shall become fully vested
in and entitled to all benefits awarded to him under the Bank's or the Company’s
recognition and retention plan or any restricted stock plan in
effect.

    

    (f)           Notwithstanding
the preceding paragraphs of this Section 2, in the event that:

    

    
      	
               
      

            	
              (i)

            	
              the
      aggregate payments or benefits to be made or afforded to Executive under
      said paragraphs (the "Termination Benefits") would be deemed to include an
      "excess parachute payment" under Section 280G of the Internal Revenue Code
      or any successor thereto, and

            

    

    

    
      	
               
      

            	
              (ii)

            	
              if
      such Termination Benefits were reduced to an amount (the "Non-Triggering
      Amount"), the value of which is one dollar ($1.00) less than an amount
      equal to the total amount of payments permissible under Section 280G of
      the Internal Revenue Code or any successor thereto, then the Termination
      Benefits to be paid to Executive shall be so reduced so as to be a
      Non-Triggering Amount.

            

    

    

    (g)           Notwithstanding
the foregoing, there will be no reduction in the Payment otherwise payable to
Executive during any period during which Executive is incapable of performing
his duties hereunder by reason of disability.

    

    (h)           For
purposes of Section 2, a Dismissal shall be construed to require a “Separation
from Service” as defined in Code Section 409A and the Treasury Regulations
thereunder, provided, however, that the Employer and Executive reasonably
anticipate that the level of bona fide services Executive would perform after
termination would permanently decrease to a level that is less than 50% of the
average level of bona fide services performed (whether as an employee or an
independent contractor) over the immediately preceding 36-month
period.

    

    
      	
              3.  

            	
              TERMINATION
      FOR CAUSE

            

    

    

    The term
“Termination for Cause” shall mean termination because of the Executive's
personal dishonesty, incompetence, willful misconduct, any breach of fiduciary
duty involving personal profit, intentional failure to perform stated duties,
willful violation of any law, rule, or regulation (other than traffic violations
or similar offenses) or final cease-and-desist order, or material breach of any
provision of this Agreement.  In determining incompetence, the acts or
omissions shall be measured against standards generally prevailing in the
financial services industry.  For purposes of this paragraph, no act
or failure to act on the part of Executive shall be considered "willful" unless
done, or omitted to be done, by the Executive not in good faith and without
reasonable belief that the Executive's action or omission was in the best
interest of the Employer.  Notwithstanding the foregoing, Executive
shall not be deemed to have been Terminated for Cause unless and until there
shall have been delivered to him a copy of a resolution duly adopted by the
affirmative vote of not less than three-fourths of the members of the Boards of
Directors of the Company and the Bank at a meeting of said Boards called and
held for that purpose (after reasonable notice to Executive and an opportunity
for him, together with counsel, to be heard before the Boards), finding that in
the good faith opinion of the Boards, Executive was guilty of conduct justifying
Termination for Cause and specifying the particulars thereof in
detail.  Notwithstanding any provision in paragraph 2, the Executive
shall not have the right to receive Termination Benefits for any period after
Termination for Cause.

    

    4.           NO
ATTACHMENT

    

    (a)           Except
as required by law, no right to receive payments under this Agreement shall be
subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge, or hypothecation, or to execution, attachment, levy, or similar
process or assignment by operation of law, and any attempt, voluntary or
involuntary, to affect any such action shall be null, void, and of no
effect.

    

    (b)           This
Agreement shall be binding upon, and inure to the benefit of, Executive and the
Employer and their respective successors and assigns.

    

    5.           MODIFICATION
AND WAIVER

    

    (a)           This
Agreement may not be modified or amended except by an instrument in writing
signed by the parties hereto.

    

    (b)           No
term or condition of this Agreement shall be deemed to have been waived, nor
shall there be any estoppel against the enforcement of any provision of this
Agreement, except by written instrument of the party charged with such waiver or
estoppel.  No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future as to any act other than that specifically
waived.

    

    6.           SEVERABILITY

    

    If, for any reason, any provision of
this Agreement, or any part of any provision, is held invalid, such invalidity
shall not affect any other provision of this Agreement or any part of such
provision not held so invalid, and each such other provision and part thereof
shall to the full extent consistent with law continue in full force and
effect.

    

    7.           EMPLOYMENT
AT WILL

    

    Except for the limited benefits granted
herein, nothing in this Agreement shall be construed to create an employment
contract and the parties acknowledge that the Executive’s employment remains “at
will”.

    

    8.           AGREEMENT
TERM

    

    The initial “Agreement Term” shall
begin on the date this agreement is executed and shall continue through December
31, 2008.  As of December 31, 2008, and as of each December 31st
thereafter, the agreement term shall extend automatically for one year unless
the Bank gives notice to the executive prior to the date of such extension that
the agreement term will not be extended.   Notwithstanding the
foregoing, if a Change in Control occurs during the agreement term, the
agreement term shall continue through and terminate on the first anniversary of
the date on which the Change in Control occurs.

    

    9.           PROPRIETARY
INFORMATION

    

    The
parties agree to the protection of the Bank’s proprietary information as
follows:

    

    
      	
              (a)  

            	
              Nondisclosure
      of Confidential Information

            

    

    

    
      	
              (i)  

            	
              Access.  The
      Executive acknowledges that employment with the Bank necessarily involves
      exposure to, familiarity with, and opportunity to learn highly sensitive,
      confidential and proprietary information of the Bank and its subsidiaries,
      which may include information about products and services, markets,
      customers and prospective customers, vendors and suppliers, miscellaneous
      business relationships, investment products, pricing, billing and
      collection procedures, proprietary software and other intellectual
      property, financial and accounting data, personnel and compensation, data
      processing and communications, technical data, marketing strategies,
      research and development of new or improved products and services, and
      know-how regarding the business of the Bank and its products and services
      (collectively referred to herein as “Confidential
      Information”)

            

    

    

    
      	
              (ii)  

            	
              Valuable
      Asset.  The Executive further acknowledges that the Confidential
      Information is a valuable, special, and unique asset of the Bank, such
      that the unauthorized disclosure or use by persons or entities outside the
      Bank would cause irreparable damage to the business of the
      Bank.  Accordingly, the Executive agrees that during and after
      the Executive’s employment with the Bank, until the Confidential
      Information becomes publicly known, the Executive shall not directly or
      indirectly disclose to any person or entity, use for any purpose or permit
      the exploitation, copying or summarizing of, any Confidential Information
      of the Bank, except as specifically required in the proper performance of
      his duties for the Bank.

            

    

    

    
      	
              (iii)  

            	
               Duties.  The
      Executive agrees to take all appropriate action, whether by instruction,
      agreement or otherwise, to endure the protection, confidentiality and
      security of the Confidential Information and to satisfy his obligations
      under this Agreement.  Prior to lecturing or publishing articles
      which reference to Bank and its business, the Executive will provide to an
      officer of the Bank a copy of the material to be presented for the Bank to
      review and approve in order to ensure that no Confidential Information is
      disclosed.

            

    

    

    
      	
              (iv)  

            	
              Confidential
      Relationship.  The Bank considers its Confidential Information
      to constitute “trade secrets” which are protected from unauthorized
      disclosure under applicable law.  However, whether or not the
      Confidential Information constitutes trade secrets, the Executive
      acknowledges and agrees that the Confidential Information is protected
      from unauthorized disclosure or use due to his covenants under this
      Section 9 and his fiduciary duties as an executive of the
      Bank.

            

    

    

    
      	
              (v)  

            	
              Return
      of Documents.  The Executive acknowledges and agrees that the
      Confidential Information is and at all times shall remain the sole and
      exclusive property of the Bank.  Upon the termination of his
      employment with the Bank or upon request by the Bank, the Executive will
      promptly return to the Bank in good condition all documents, data and
      records of any kind, whether in hardcopy or electronic form, which contain
      any Confidential Information, including any and all copies thereof, as
      well as all materials furnished to or acquired by the Executive during the
      course of the Executive’s employment with the
  Bank.

            

    

    

    
      	
              (b)  

            	
              Enforcement.  For
      purposes of this Section 9, the term “Bank” shall include the Bank and the
      Company and all of their subsidiaries.  Each such entity shall
      be an intended third party beneficiary of this Agreement and shall have
      the right to enforce the provisions of this Agreement against the
      Executive individually or collectively with any one or more of the other
      subsidiaries.

            

    

    

    
      	
              (c)  

            	
              Equitable
      Relief.  The Executive acknowledges and agreed that, by reason
      of the sensitive nature of the Confidential Information of the Bank
      referred to in this Agreement, in addition to recovery of damages and any
      other legal relief to which the Bank may be entitled in the event of the
      Executive’s violation of this Agreement, the Bank shall also be entitled
      to equitable relief, including such injunctive relief as may be necessary
      to protect the interests of the Bank in such Confidential Information and
      as may be necessary to specifically enforce the Executive’s obligations
      under this Agreement.

            

    

    

    10.           HEADINGS
FOR REFERENCE ONLY

    

    The headings of sections and paragraphs
herein are included solely for convenience of reference and shall not control
the meaning or interpretation of any of the provisions of this
Agreement.

    

    11.           GOVERNING
LAW

    

    This Agreement shall be governed by the
laws of the State of New York, but only to the extent not superseded by federal
law.

    

    12.           ARBITRATION

    

    Any dispute or controversy arising
under or in connection with this Agreement shall be settled exclusively by
arbitration in accordance with the rules of the American Arbitration Association
then in effect.  Judgment may be entered on the arbitrator's award in
any court having jurisdiction.

    

    13.           SUCCESSOR
TO THE EMPLOYER

    

    The Employer shall require any
successor or assignee, whether direct or indirect, by purchase, merger,
consolidation or otherwise, to all or substantially all the business or assets
of the Bank or the Company, expressly and unconditionally to assume and agree to
perform the Employer's obligations under this Agreement, in the same manner and
to the same extent that the Employer would be required to perform if no such
succession or assignment had taken place.

    

    14.           REQUIRED
PROVISION

     

    Notwithstanding
anything herein contained to the contrary, any payments to Executive by the
Bank, whether pursuant to this Agreement or otherwise, are subject to and
conditioned upon their compliance with Section 18(k) of the Federal Deposit
Insurance Act, 12 U.S.C. § 1828(k), and the regulations promulgated thereunder
in 12 C.F.R. Part 359.

     

    

    SIGNATURES

    

    

    IN WITNESS WHEREOF, the
Employer has caused this Agreement to be executed and its seal to be affixed
hereunto by its duly authorized officer, and Executive has signed this
Agreement, on the day and date first above written.

    

    
      	
               
      

            	
              PATHFINDER
      BANK

            

    

    

    

    
      	
               
      

            	
              12/23/08

            	
                     By:
      /s/ Thomas W. Schneider

            	 

    

                                                                   
Date                                                    
Thomas W. Schneider

                                 
President and Chief Executive Officer

    

    

    PATHFINDER BANCORP, INC.

    

    

    

    
      	
               
      

            	
              12/23/08

            	
                     By:
      /s/ Thomas W. Schneider

            	 

    

                                                                   
Date                                                     Thomas
W. Schneider

                                 
President and Chief Executive Officer

    

    

    EXECUTIVE

    

    

                                                                   
12/23/08                                       By:
/s/ Melissa A. Miller

                                                                   
Dateexh10-10.htm

    AMENDED
AND RESTATED EXECUTIVE SUPPLEMENTAL RETIREMENT

    INCOME
AGREEMENT

    FOR

    CHRIS
C. GAGAS

     

    PATHFINDER
BANK

     

    Amended
and Restated Effective January 1, 2005

     

    Financial
Institution Consulting Corporation

    700
Colonial Road, Suite 260

    Memphis,
Tennessee 38117

    WATS:
1-800-873-0089

    FAX:
(901) 684-7411

    (901)
684-7400

     

    AMENDED
AND RESTATED

    EXECUTIVE
SUPPLEMENTAL RETIREMENT

    INCOME
AGREEMENT FOR CHRIS GAGAS

     

    This
Amended and Restated Executive Supplemental Retirement Income Agreement (the
“Agreement”) updates and revises the Restated Executive Supplemental Retirement
Income Agreement (the “Original Agreement”) for Chris C. Gagas (the
“Executive”), which was originally effective as of September 1,
1998.  The Bank has herein amended and restated the Agreement with the
intention that the Agreement shall at all times satisfy Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”) and the regulations
thereunder.  Any reference herein to the “Holding Company” shall mean
Pathfinder Bancorp, Inc. and any reference herein to the “Mutual Holding
Company” shall mean Pathfinder Bancorp, M.H.C.

     

    WITNESSETH:

     

    WHEREAS, the Executive and the
Bank entered into the Agreement dated as of September 1, 1998; and

    

    WHEREAS, Section 409A of the
Internal Revenue Code (the “Code”), effective January 1, 2005, requires deferred
compensation arrangements to comply with its provisions and restrictions and
limitations on payments of deferred compensation; and

     

    WHEREAS, Code Section 409A and
the final regulations issued thereunder necessitate changes to the Agreement;
and

    

    WHEREAS, the Executive has
agreed to such changes; and

    

    WHEREAS, the parties hereto
desire to set forth the terms of the amended and restated Agreement and the
continuing employment relationship of the Bank and the Executive;
and

    

    WHEREAS, the Bank and the
Executives intend this Agreement to be considered an unfunded arrangement,
maintained primarily to provide supplemental retirement income for such
Executives, members of a select group of management or highly compensated
employees of the Bank, for tax purposes and for purposes of the Employee
Retirement Income Security Act of 1974, as amended.

     

    NOW, THEREFORE, in
consideration of the premises and of the mutual promises herein contained, the
Bank and the Executive agree as follows:

     

    SECTION
I

     

    DEFINITIONS

     

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

     

    
      	
              1.1  

            	
              “Accrued
      Benefit Account” means that portion of the Supplemental Retirement Income
      Benefit which is required to be expensed and accrued under generally
      accepted accounting principles (GAAP) by any appropriate method which the
      Bank’s Board of Directors may require in the exercise of its sole
      discretion.

            

    

     

    
      	
              1.2  

            	
              “Act”
      means the Employee Retirement Income Security Act of 1974, as amended from
      time to time.

            

    

     

    
      	
              1.3  

            	
              “Administrator”
      means the Bank.

            

    

     

    
      	
              1.4  

            	
              “Bank”
      means PATHFINDER BANK and any successor
thereto.

            

    

     

    
      	
              1.5  

            	
              “Beneficiary”
      means the person or persons (and their heirs) designated as Beneficiary in
      Exhibit B of this Agreement to whom the deceased Executive’s benefits are
      payable.  If no Beneficiary is so designated, then the
      Executive’s Spouse, if living, will be deemed the Beneficiary. If the
      Executive’s Spouse is not living, then the Children of the Executive will
      be deemed the Beneficiaries and will take on a per stirpes
      basis.  If there are no Children, then the Estate of the
      Executive will be deemed the
Beneficiary.

            

    

     

    
      	
              1.6  

            	
              “Benefit
      Age” means the Executive’s seventieth (70th)
      birthday.  Notwithstanding the above, in the event of a Change
      in Control, followed within thirty-six (36) months by the Executive’s
      voluntary termination of employment on or after his sixty-second birthday
      for one of the reasons set forth in Section 2.2 below, the Executive’s
      termination shall not be considered a retirement for purposes of lowering
      the Executive’s Benefit Age.

            

    

     

    
      	
              1.7  

            	
              “Benefit
      Eligibility Date” means the date on which the Executive is entitled to
      receive maximum Supplemental Retirement Income Benefit available under
      this plan.  It shall be the first day of the month following the
      month in which the Executive attains his Benefit
  Age.

            

    

     

    
      	
              1.8  

            	
              “Board
      of Directors” means the board of directors of the
  Bank.

            

    

     

    
      	
              1.9  

            	
              “Cause”
      means personal dishonesty, willful misconduct, willful malfeasance, breach
      of fiduciary duty involving personal profit, intentional failure to
      perform stated duties, willful violation of any law, role, regulation
      (other than traffic violations or similar offenses), or final
      cease-and-desist order, material breach of any provision of this
      Agreement, or gross negligence in matters of material importance to the
      Bank.

            

    

     

    
      	
              1.10

            	
              “Change
      in Control” shall mean and include the following with respect to the
      Mutual Holding Company, the Bank, or the Holding
  Company:

            

    

     

    
      	
               
      

            	
              (i)

            	
              a
      reorganization, merger, merger conversion, consolidation or sale of all or
      substantially all of the assets of the Bank, the Mutual Holding Company or
      the Holding Company, or a similar transaction in which the Bank, the
      Mutual Holding Company or the Holding Company is not the resulting entity;
      or

            

    

    

    
      	
               
      

            	
              (ii)

            	
              individuals
      who constitute the board of directors of the Bank, the Mutual Holding
      Company or the Holding Company on the date hereof (the “Incumbent Board”)
      cease for any reason to constitute at least a majority thereof, provided
      that any person becoming a director subsequent to the date hereof whose
      election was approved by a vote of at least three-quarters of the
      directors comprising the Incumbent Board, or whose nomination for election
      was approved by the Holding Company’s nominating committee which is
      comprised of members of the Incumbent Board, shall be, for purposes of
      this clause (ii) considered as though he were a member of the Incumbent
      Board.

            

    

    

    Notwithstanding
the foregoing, a “Change in Control” of the Bank or the Holding Company shall
not be deemed to have occurred if the Mutual Holding Company ceases to own at
least 51% of all outstanding shares of stock of the Holding Company in
connection with a liquidation of the Mutual Holding Company into the Holding
Company or a conversion of the Mutual Holding Company from mutual to stock
form.

     

    In
addition, “Change in Control” shall mean and include the following with respect
to the Bank or the Holding Company in the event that the Mutual Holding Company
converts to stock form or in the event that the Holding Company issues shares of
its common stock to stockholders other than the Mutual Holding
Company:

     

    
      	
               
      

            	
              (1)

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

            

    

     

    
      	
               
      

            	
              (2)

            	
              an
      acquisition of  “control” as defined in the Home Owners Loan
      Act, as amended, and applicable rules and regulations promulgated
      thereunder, as in effect at the time of the Change in Control
      (collectively, the “HOLA”), as determined by the Board of Directors of the
      Bank or the Holding Company; or

            

    

     

    
      	
               
      

            	
              (3)

            	
              at
      such time as:

            

    

     

    
      	
               
      

            	
              (i)

            	
              any
      “person” (as the term is used in Sections 13(d) and 14(d) of the Exchange
      Act) or “group acting in concert” is or becomes the “beneficial owner” (as
      defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
      securities of the Bank representing Twenty Percent (20%) or more of the
      combined voting power of the Bank’s or Holding Company’s outstanding
      securities ordinarily having the right to vote at the elections of
      directors, except for any stock purchased by the Bank’s Employee Stock
      Ownership Plan and/or the trust under such plan;
  or

            

    

     

    
      	
               
      

            	
              (ii)

            	
              a
      proxy statement is issued soliciting proxies from the stockholders of the
      Holding Company by someone other than the current management of the
      Holding Company, seeking stockholder approval of a plan of reorganization,
      merger, or consolidation of the Holding Company with one or more
      corporations as a result of which the outstanding shares of the class of
      the Holding Company’s securities are exchanged for or converted into cash
      or property or securities not issued by the Holding
    Company.

            

    

     

    The term
“person” includes an individual, a group acting in concert, a corporation, a
partnership, an association, a joint venture, a pool, a joint stock company, a
trust, an unincorporated organization or similar company, a syndicate or any
other group formed for the purpose of acquiring, holding or disposing of
securities. The term “acquire” means obtaining ownership, control, power to vote
or sole power of disposition of stock, directly or indirectly or through one or
more transactions or subsidiaries, through purchase, assignment, transfer,
exchange, succession or other means, including (1) an increase in percentage
ownership resulting from a redemption, repurchase, reverse stock split or a
similar transaction involving other securities of the same class; and (2) the
acquisition of stock by a group of persons and/or companies acting in concert
which shall be deemed to occur upon the formation of such group, provided that
an investment advisor shall not be deemed to acquire the voting stock of its
advisee if the advisor (a) votes the stock only upon instruction from the
beneficial owner and (b) does not provide the beneficial owner with advice
concerning the voting of such stock. The term “security” includes
nontransferable subscription rights issued pursuant to a plan of conversion, as
well as a “security,” as defined in 15 U.S.C. §78c(2)(1); and the term “acting
in concert” means (1) knowing participation in a joint activity or
interdependent conscious parallel action towards a common goal whether or not
pursuant to an express agreement, or (2) a combination or pooling of voting or
other interests in the securities of an issuer for a common purpose pursuant to
any contract, understanding, relationship, agreement or other arrangement,
whether written or otherwise. Further, acting in concert with any person or
company shall also be deemed to be acting in concert with any person or company
that is acting in concert with such other person or company.

     

    Notwithstanding
the above definitions, the boards of directors of the Bank or the Holding
Company, in their absolute discretion, may make a finding that a Change in
Control of the Bank or the Holding Company has taken place without the
occurrence of any or all of the events enumerated above.

     

    
      	
              1.11  

            	
              Children”
      means the Executive’s children, both natural and adopted, then living at
      the time payments are due the Children under this
    Agreement.

            

    

     

    
      	
              1.12  

            	
              “Code”
      means the Internal Revenue Code of 1986, as amended from time to
      time.

            

    

     

    
      	
              1.13  

            	
              “Disability
      Benefit” means the benefit payable to the Executive following a
      determination, in accordance with Section
VII.

            

    

     

    
      	
              1.14  

            	
              “Effective
      Date” of this Agreement is January 1,
2005.

            

    

     

    
      	
              1.15  

            	
              “Estate”
      means the estate of the Executive.

            

    

     

    
      	
              1.16  

            	
              “Interest
      Factor” for purposes of the Accrued Benefit Account, shall be eight
      percent (8%) per annum, compounded monthly, as set forth in Exhibit
      A.

            

    

     

    
      	
              1.17  

            	
              “Payout
      Period” means the time frame during which certain benefits payable
      hereunder shall be distributed.  Payments shall be made in equal
      monthly installments commencing on the first day of the month following
      the occurrence of the event which triggers distribution and continuing for
      one hundred eighty (180) months.  Should the Executive make a
      Timely Election to receive a lump sum benefit payment, the Executive’s
      Payout Period shall be deemed to be one (1)
  month.

            

    

     

    
      	
              1.18  

            	
              “Plan
      Year” shall mean the calendar year.  However, “Plan Year” shall
      mean September 1, 1998 through December 31, 1998, for the first Plan
      Year.

            

    

     

    
      	
              1.19  

            	
              “Retirement
      Age” means the Executive’s seventieth (70th) birthday.

            

    

     

    
      	
              1.20  

            	
              “Spouse”
      means the individual to whom the Executive is legally married at the time
      of the Executive’s death.

            

    

     

    
      	
              1.21  

            	
              “Supplemental
      Retirement Income Benefit” means an annual amount (before taking
      into account federal and state income taxes), payable in monthly
      installments throughout the Payout Period.  The Supplemental
      Retirement Income Benefit payable to the Executive is Sixty Thousand Six
      Hundred and Eighty-six ($60,686) Dollars, as set forth in Exhibit
      A.

            

    

     

    
      	
              1.22  

            	
              “Survivor’s
      Benefit” means an annual amount payable to the Beneficiary in monthly
      installments throughout the Payout Period, equal to the amount set forth
      in Exhibit A and according to Subsection
2.5.

            

    

     

    
      	
              1.23  

            	
              “Timely
      Election” means the Executive has made an election to change the form of
      his benefit payment(s) by filing with the Administrator a Notice of
      Election to Change Form of Payment (Exhibit C of this
      Agreement).  Such election must be made on or before December
      31, 2008.

            

    

     

    SECTION
II

     

    BENEFITS-GENERALLY

     

    
      	
              2.1  

            	
              Retirement
      Benefit.

            

    

     

    If the
Executive is in service with the Bank until reaching his Benefit Age, the
Executive shall be entitled to the Supplemental Retirement Income
Benefit.  Such benefit shall commence on the Executive’s Benefit
Eligibility Date and shall be payable in equal monthly installments throughout
the Payout Period.  In the event the Executive dies at any time after
attaining his Benefit Age, but prior to completion of all such payments due and
owing hereunder, the Bank shall pay to the Executive’s Beneficiary a
continuation of the monthly installments for the remainder of the Payout
Period.

     

    
      	
              2.2  

            	
              Termination Following
      a Change in Control

            

    

     

    If a
Change in Control occurs, and within thirty-six (36) months following such
Change in Control, the Executive’s employment is either (i) involuntarily
terminated, or (ii) voluntarily terminated by the Executive after: (A) a
material change in the Executive’s function, duties, or responsibilities, which
change would cause the Executive’s position to become one of lesser
responsibility, importance, or scope from the position the Executive held at the
time of the Change in Control, (B) a relocation of the Executive’s principal
place of employment by more than thirty (30) miles from its location prior to
the Change in Control, or (C) a material reduction in the benefits and
perquisites to the Executive from those being provided at the time of the Change
in Control, the Executive shall be entitled to the full Supplemental Retirement
Income Benefit set forth in Exhibit A that Executive would have received had
Executive continued employment up through reaching his Benefit Eligibility Date,
regardless of the Executive’s actual age on date of termination.  Such
benefit shall commence within thirty (30) days following the Executive reaching
his Benefit Age and shall be payable in equal monthly installments throughout
the Payout Period.  Notwithstanding the foregoing, in the event the
Executive is a Specified Employee, as defined in Treasury Regulation Section
1.409A-1(i), the Supplemental Retirement Income Benefit shall commence upon the
later of: (i) the first day of the seventh month following the executive’s
termination of employment or (ii) the date on which the Executive attains his
Benefit Age.  In the event that the Executive dies at any time after
termination of employment, but prior to commencement or completion of all such
payments due and owing hereunder, the Bank, or its successor, shall pay to the
Executive’s Beneficiary a continuation of the monthly installments for the
remainder of the Payout Period within thirty (30) days of Executive’s
death.  For purposes of this Section 2.2, the Executive’s termination
of employment shall be construed to require a Separation from Service as defined
in Code Section 409A and the Treasury Regulations promulgated thereunder, such
that the Bank and Executive reasonably anticipate that the level of bona fide
services the Executive would perform after termination would permanently
decrease to a level that is less than 50% of the average level of bona fide
services performed (whether as an employee or an independent contractor) over
the immediately preceding 36-month period.

     

    
      	
              2.3  

            	
              Termination For
      Cause

            

    

     

    If the
Executive is terminated for Cause, all benefits under this Agreement shall be
forfeited and this Agreement shall become null and void.

     

    
      	
              2.4  

            	
              Involuntary
      Termination of Employment

            

    

     

    If the
Executive’s employment with the Bank is involuntarily terminated for any reason,
including a termination due to Disability, but excluding termination for Cause,
or termination following a Change in Control within thirty-six (36) months
following such Change in Control, within thirty (30) days following such
involuntary termination of employment, the Executive (or his Beneficiary) shall
be entitled to the full Supplemental Retirement Income Benefit set forth in
Exhibit A that the Executive would have received had the Executive continued
employment up through reaching his Benefit Eligibility Date, regardless of the
Executive’s actual age at termination of employment.  Such benefit
shall commence within thirty (30) days following the Executive reaching his
Benefit Age and shall be payable in monthly installments throughout the Payout
Period.  In the event the Executive dies prior to commencement or
completion of all such payments due and owing hereunder, the Bank shall pay to
the Executive’s Beneficiary a continuation of the monthly installments for the
remainder of the Payout Period.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              2.5  

            	
              Death During
      Employment

            

    

     

    If the
Executive dies while employed by the Bank, the Executive’s Beneficiary shall be
entitled to the Survivor’s Benefit.  The Survivor’s Benefit shall
commence within thirty (30) days after the Executive’s death and shall be
payable in monthly installments throughout the Payout Period.

     

    SECTION
III

     

    RETIREMENT
BENEFIT

     

    
      	
              3.1  

            	
              (a)           Normal form of
      payment.

            

    

     

    If (i)
the Executive is employed with the Bank until reaching his Retirement Age, and
(ii) the Executive has not made a Timely Election to receive a lump sum benefit,
this Subsection 3.1(a) shall be controlling with respect to retirement
benefits.

     

    The
Executive shall be entitled to the Supplemental Retirement Income
Benefit.  Such benefit shall commence on the Executive’s Benefit
Eligibility Date and shall be payable in monthly installments throughout the
Payout Period.  In the event the Executive dies at any time after
attaining his Benefit Age, but prior to completion of all the payments due and
owing hereunder, the Bank shall pay to the Executive’s Beneficiary a
continuation of the monthly installments for the remainder of the Payout
Period.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b)           Alternative payout
option.

     

    If (i)
the Executive is employed with the Bank until reaching his Retirement Age, and
(ii) the Executive has made a Timely Election to receive a lump sum benefit,
this Subsection 3.1(b) shall be controlling with respect to retirement
benefits.

     

    The
balance of the amount represented by the Executive’s Accrued Benefit Account,
measured as of the Executive’s Benefit Age, shall be paid to the Executive in a
lump sum on his Benefit Eligibility Date.  In the event the Executive
dies after becoming eligible for such payment (upon attainment of his Benefit
Age), but before the actual payment is made, his Beneficiary shall be entitled
to receive the lump sum benefit in accordance with this Subsection 3.1(b) within
thirty (30) days following the date of the Executive’s death.

     

    
      	
              3.2  

            	
              Additional Death
      Benefit - Burial Expense. In addition to the above-described
      benefits, upon the Executive’s death, the Executive’s Beneficiary shall be
      entitled to receive a one-time lump sum death benefit in the amount of Ten
      Thousand Dollars ($10,000.00).  This benefit shall be provided
      specifically for the purpose of providing payment for burial and/or
      funeral expenses of the Executive. Such benefit shall be payable within
      thirty (30) days of the Executive’s death.  The Executive’s
      Beneficiary shall not be entitled to such benefit if the Executive is
      removed for Cause prior to death.  Notwithstanding anything in
      this Section 3.2 to the contrary, if the Executive is also a participant
      in any other Trustee Deferred Compensation Agreement or an Executive
      Deferred Compensation Agreement under which an additional $10,000 death
      benefit for burial expenses is being paid, no additional death benefit
      shall be paid under this Section
3.2.

            

    

     

    SECTION
IV

     

    PRE-RETIREMENT DEATH
BENEFIT

     

    
      	
              4.1  

            	
              (a)           Normal form of
      payment.

            

    

     

    If (i)
the Executive dies while employed by the Bank, and (ii) the Executive has not
made a Timely Election to receive a lump sum benefit, this Subsection 4.1(a)
shall be controlling with respect to pre-retirement death benefits.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    The
balance of the amount represented by the Executive’s Accrued Benefit Account,
measured as of the Executive’s death shall be annuitized (using the Interest
Factor) into monthly installments and shall be payable to the Executive’s
Beneficiary for the Payout Period.  Such benefits shall commence
within thirty (30) days following the date of the Executive’s
death.  The Executive’s Beneficiary may request to receive the
remainder of any unpaid monthly benefit payments due from the Accrued Benefit
Account in a lump sum payment.  If a lump sum payment is requested by
the Beneficiary, the amount of such lump sum payment shall be equal to the
balance of the Executive’s Accrued Benefit Account.  Payment in such
lump sum form shall be made only if the Executive’s Beneficiary (i) obtains
Board of Director approval, and (ii) notifies the Administrator in writing of
such election within ninety (90) days following the Executive’s
death.  Such lump sum payment, if approved by the Board of Directors,
shall be payable within thirty (30) days following such Board of Director
approval.

     

    (b)           Alternative payout
option.

     

    If (i)
the Executive dies while employed by the Bank, and (ii) the Executive has made a
Timely Election to receive a lump sum benefit, this Subsection 4.1(b) shall be
controlling with respect to pre-retirement death benefits.

     

    The
balance of the amount represented by the Executive’s Accrued Benefit Count,
measured as of (i) the Executive’s death, and (ii) shall be paid to the
Executive’s Beneficiary in a lump sum within thirty (30) days following the date
of the Executive’s death.

     

    SECTION
V

     

    RENDERING OF CONSULTING
SERVICES

     

    Beginning
September 1, 1999, until the Executive reaches Benefit Age, the Executive shall
render such reasonable business consulting, advisory and public relations
services as the Association’s Board of Directors may call upon the Executive to
provide.  In no event shall such service exceed thirty (30) service
days per year.  The Bank shall provide Executive with advance notice
sufficient to Executive of its desire to have such service
provided.  In rendering these services, the Executive shall not be
considered an employee of the Bank, but shall act in the capacity of an
independent contractor.  The Executive shall not be required to
perform these services during reasonable vacation periods or any periods of
illness or disability.  Furthermore, the Executive shall be reimbursed
for all expenses incurred in performing such services.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    This
service requirement shall not apply if Executive’s entitlement is limited to the
balance represented by the Accrued Benefit Account, pursuant to Section
VI.

     

    SECTION
VI

     

    BENEFIT(S) IN THE EVENT OF
TERMINATION OF SERVICE

     

    PRIOR TO RETIREMENT
AGE

     

    If the
Executive voluntarily terminates employment with the Bank before reaching his
Benefit Age, other than a voluntary termination following a Change in Control in
accordance with Subsection 2.2 hereof or for the purpose of rendering Consulting
Services pursuant to Section V, Executive’s Supplemental Retirement Benefit
shall be limited to the balance represented by the Accrued Benefit Account
spread out and payable over the Payout Period.  Such payment shall
commence on the date in which the Executive reaches his Benefit Age and be
payable over the Payout Period, provided, however, the in the event the
Executive is a Specified Employee, as defined in Treasury Regulation Section
1.409A-1(i), such Supplemental Retirement Income Benefit shall commence upon the
later of: (i) the first day of the seventh month following the executive’s
termination of employment or (ii) the date on which the Executive attains his
Benefit Age.  For purposes of this Section VI, the Executive’s
termination of employment shall be construed to require a Separation from
Service as defined in Code Section 409A and the Treasury Regulations promulgated
thereunder, such that the Bank and Executive reasonably anticipate that the
level of bona fide services the Executive would perform after termination would
permanently decrease to a level that is less than 50% of the average level of
bona fide services performed (whether as an employee or an independent
contractor) over the immediately preceding 36-month period.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECTION
VII

     

    DISABILITY
BENEFIT

     

    If the
Executive’s service is terminated prior to Retirement Age due to a disability
which meets the criteria set forth below, the Executive shall receive the
Disability Benefit in lieu of the retirement benefit(s) available pursuant to
Section III (which is (are) not available prior to the Executive’s Benefit
Eligibility Date).

     

    For
purposes of this Section “Disability” or “Disabled” shall mean the Executive:
(i) is unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months; (ii) is, by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than 3 months under an accident
and health plan covering employees of the Executive’s employer; or (iii) is
determined to be totally disabled by the Social Security Administration. In any instance in which
it is determined that the Executive is Disabled, the Executive shall be entitled
to the following lump sum benefit(s).  The lump sum benefit(s) to
which the Executive is entitled shall be the balance represented by the Accrued
Benefit Account.  The benefit(s) shall be paid within thirty (30) days
following the date the Executive is determined to be
Disabled.   In the event the Executive dies after becoming
eligible for such payment(s) but before the actual payment(s) is (are) made, his
Beneficiary shall be entitled to receive the benefit(s) provided for in this
Section 7 within thirty (30) days following the Executive’s death.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECTION
VIII

     

    BENEFICIARY
DESIGNATION

     

    The
Executive shall make an initial designation of primary and secondary
Beneficiaries upon execution of this Agreement and shall have the right to
change such designation, at any subsequent time, by submitting to the
Administrator, in substantially the form attached as Exhibit B to this
Agreement, a written designation of primary and secondary
Beneficiaries.  Any Beneficiary designation made subsequent to
execution of this Agreement shall become effective only when receipt thereof is
acknowledged in writing by the Administrator.

     

    SECTION
IX

     

    NON-COMPETITION

     

    
      	
              9.1  

            	
              Non-Competition During
      Employment.

            

    

     

    In
consideration of the agreements of the Bank contained herein and of the payments
to be made by the Bank pursuant hereto, the Executive hereby agrees that, for as
long as he remains employed by the Bank, he will devote substantially all of his
time, skill, diligence and attention to the business of the Bank, and will not
actively engage, either directly or indirectly, in any business or other
activity which is, or may be deemed to be, in any way competitive with or
adverse to the best interests of the business of the Bank, unless the Executive
has the prior express written consent of the Bank.

     

    
      	
              9.2  

            	
              Breach of
      Non-Competition Clause.

            

    

     

    (a)           Continued Employment
Following Breach.

     

    In the
event (i) any material breach by the Executive of the agreements and covenants
described in Subsection 8.1 occurs, and (ii) the Executive continues employment
at the Bank following such breach, all benefits under this Agreement shall be
forfeited.

     

    (b)           Termination of Employment
Following Breach.

     

    In the
event (i) any material breach by the Executive of the agreements and covenants
described in Subsection 9.2 occurs, and (ii) the Executive’s employment with the
Bank is terminated due to such breach, such termination shall be deemed to be
for Cause and the benefits under this Agreement shall be forfeited.

     

    
      	
              9.3  

            	
              Non-Competition
      Following Employment.

            

    

     

    Executive
further understands and agrees that, following Executive’s termination of
employment, the Bank’s obligation, if any, to make payments to the Executive
under this Agreement shall be conditioned on the Executive’s forbearance from
actively engaging, either directly or indirectly, in any business or other
activity which is, or may be deemed to be, in any way competitive with or
adverse to the best interests of the Bank, unless the Executive has the prior
written consent of the Bank.  In the event of the Executive’s breach
of the covenants and agreements contained herein, further payments to the
Executive shall cease and be forfeited.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECTION
X

     

    EXECUTIVE’S RIGHT TO
ASSETS

     

    The
rights of the Executive, any Beneficiary, or any other person claiming through
the Executive under this Agreement, shall be solely those of an unsecured
general creditor of the Bank.  The Executive, the Beneficiary, or any
other person claiming through the Executive, shall only have the right to
receive from the Bank those payments or amounts so specified under this
Agreement.  The Executive agrees that he, his Beneficiary, or any
other person claiming through him shall have no rights or interests whatsoever
in any asset of the Bank, including any insurance policies or contracts which
the Bank may possess or obtain to informally fund this Agreement.  Any
asset used or acquired by the Bank in connection with the liabilities it has
assumed under this Agreement shall not be deemed to be held under any trust for
the benefit of the Executive or his Beneficiaries, unless such asset is
contained in the rabbi trust described in Section XIII of this
Agreement.  Any such asset shall be and remain, a general, unpledged
asset of the Bank in the event of the Bank’s insolvency.

     

    SECTION
XI

     

    RESTRICTIONS UPON
FUNDING

     

    The Bank
shall have no obligation to set aside, earmark or entrust any fund or money with
which to pay its obligations under this Agreement.  The Executive, his
Beneficiaries or any successor in interest to him shall be and remain simply a
general unsecured creditor of the Bank in the same manner as any other creditor
having a general claim for matured and unpaid compensation.  The Bank
reserves the absolute right in its sole discretion to either purchase assets to
meet its obligations undertaken by this Agreement or to refrain from the same
and to determine the extent, nature, and method of such asset
purchases.  Should the Bank decide to purchase assets such as life
insurance, mutual funds, disability policies or annuities, the Bank reserves the
absolute right, in its sole discretion, to replace such assets from time to time
or to terminate its investment in such assets at any time, in whole or in
part.  At no time shall the Executive be deemed to have any lien,
right, title or interest in or to any specific investment or to any assets of
the Bank.  If the Bank elects to invest in a life insurance,
disability or annuity policy upon the life of the Executive, then the Executive
shall assist the Bank by freely submitting to a physical examination and by
supplying such additional information necessary to obtain such insurance or
annuities.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECTION
XII

     

    ACT
PROVISIONS

     

    
      	
              12.1  

            	
              Named Fiduciary and
      Administrator. The Bank, as Administrator, shall be the Named
      Fiduciary of this Agreement.  As Administrator, the Bank shall
      be responsible for the management, control and administration of the
      Agreement as established herein.  The Administrator may delegate
      to others certain aspects of the management and operational
      responsibilities of the Agreement, including the employment of advisors
      and the delegation of ministerial duties to qualified
      individuals.

            

    

     

    
      	
              12.2  

            	
              Claims Procedure and
      Arbitration. In the event that benefits under this Agreement are
      not paid to the Executive (or to his Beneficiary in the case of the
      Executive’s death) and such claimants feel they are entitled to receive
      such benefits, then a written claim must be made to the Administrator
      within sixty (60) days from the date payments are refused.  The
      Administrator shall review the written claim and, if the claim is denied,
      in whole or in part, it shall provide in writing, within ninety (90) days
      of receipt of such claim, its specific reasons for such denial, reference
      to the provisions of this Agreement upon which the denial is based, and
      any additional material or information necessary to perfect the
      claim.  Such writing by the Administrator shall further indicate
      the additional steps which must be undertaken by claimants if an
      additional review of the claim denial is
  desired.

            

    

     

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

     

    If
claimants continue to dispute the benefit denial based upon completed
performance of this Agreement and the Joinder Agreement or the meaning and
effect of the terms and conditions thereof, then claimants may submit the
dispute to mediation, administered by the American Arbitration Association
(“AAA”) (or a mediator selected by the parties) in accordance with the AAA’s
Commercial Mediation Rules.  If mediation is not successful in
resolving the dispute, it shall be settled by arbitration administered by the
AAA under its Commercial Arbitration Rules, and judgment on the award rendered
by the arbitrator(s) may be entered in any court having jurisdiction
thereof.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECTION
XIII

     

    MISCELLANEOUS

     

    
      	
              13.1  

            	
              No Effect on
      Employment Rights. Nothing contained herein will confer upon the
      Executive the right to be retained in the service of the Bank nor limit
      the right of the Bank to discharge or otherwise deal with the Executive
      without regard to the existence of the
  Agreement.

            

    

     

    
      	
              13.2  

            	
              State Law. The
      Agreement is established under, and will be construed according to, the
      laws of the state of New York, to the extent such laws are not preempted
      by the Act and valid regulations published
  thereunder.

            

    

     

    
      	
              13.3  

            	
              Severability.
      In the event that any of the provisions of this Agreement or portion
      thereof, are held to be inoperative or invalid by any court of competent
      jurisdiction, then: (i) insofar as is reasonable, effect will be given to
      the intent manifested in the provisions held invalid or inoperative, and
      (ii) the validity and enforceability of the remaining provisions will not
      be affected thereby.

            

    

     

    
      	
              13.4  

            	
              Incapacity of
      Recipient. In the event the Executive is declared incompetent and a
      conservator or other person legally charged with the care of his person or
      Estate is appointed, any benefits under the Agreement to which such
      Executive is entitled shall be paid to such conservator or other person
      legally charged with the care of his person or
  Estate.

            

    

     

    
      	
              13.5  

            	
              Unclaimed
      Benefit. The Executive shall keep the Bank informed of his current
      address and the current address of his Beneficiaries. The Bank shall not
      be obligated to search for the whereabouts of any person.  If
      the location of the Executive is not made known to the Bank as of the date
      upon which any payment of any benefits from the Accrued Benefit Account
      may first be made, the Bank shall delay payment of the Executive’s benefit
      payment(s) until the location of the Executive is made known to the Bank;
      however, the Bank shall only be obligated to hold such benefit payment(s)
      for the Executive until the expiration of thirty-six (36)
      months.  Upon expiration of the thirty-six (36) month period,
      the Bank may discharge its obligation by payment to the Executive’s
      Beneficiary.  If the location of the Executive’s Beneficiary is
      not made known to the Bank by the end of an additional two (2) month
      period following expiration of the thirty-six (36) month period, the Bank
      may discharge its obligation by payment to the Executive’s
      Estate.  If there is no Estate in existence at such time or if
      such fact cannot be determined by the Bank, the Executive and his
      Beneficiary(ies) shall thereupon forfeit any rights provided for such
      Executive and/or Beneficiary under this
  Agreement.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              13.6  

            	
              Limitations on
      Liability. Notwithstanding any of the preceding provisions of the
      Agreement, no individual acting as an employee or agent of the Bank, or as
      a member of the Board of Directors shall be personally liable to the
      Executive or any other person for any claim, loss, liability or expense
      incurred in connection with the
Agreement.

            

    

     

    
      	
              13.7  

            	
              Gender.
      Whenever in this Agreement words are used in the masculine or neuter
      gender, they shall be read and construed as in the masculine, feminine or
      neuter gender, whenever they should so
apply.

            

    

     

    
      	
              13.8  

            	
              Effect on Other
      Corporate Benefit Agreements. Nothing contained in this Agreement
      shall affect the right of the Executive to participate in or be covered by
      any qualified or non-qualified pension, profit sharing, group, bonus or
      other supplemental compensation or fringe benefit agreement constituting a
      part of the Bank’s existing or future compensation
    structure.

            

    

     

    
      	
              13.9  

            	
              Suicide.
      Notwithstanding anything to the contrary in this Agreement, if the
      Executive’s death results from suicide, whether sane or insane, within
      twenty-six (26) months after execution of this Agreement, all benefits
      under this Agreement shall be forfeited, and this Agreement shall become
      null and void.

            

    

     

    
      	
              13.10  

            	
              Inurement. This
      Agreement shall be binding upon and shall inure to the benefit of the
      Bank, its successors and assigns, and the Executive, his successors,
      heirs, executors, administrators, and
  Beneficiaries.

            

    

     

    
      	
              13.11  

            	
              Headings.
      Headings and sub-headings in this Agreement are inserted for reference and
      convenience only and shall not be deemed a part of this
      Agreement.

            

    

     

    
      	
              13.12  

            	
              Source of
      Payments. All payments provided in this Agreement shall be timely
      paid in cash or check from the general funds of the Bank or the assets of
      the rabbi trust.

            

    

     

    
      	
              13.13  

            	
              Tax Withholding and
      Code Section 409A Taxes.  Any distribution under this
      Agreement shall be reduced by the amount of any taxes required to be
      withheld from such distribution.  This Agreement shall permit
      the acceleration of the time or schedule of a payment to pay employment
      related taxes as permitted under Treasury Regulation Section 1.409A-3(j)
      or to pay any taxes that may become due at any time that the arrangement
      fails to meet the requirements of Code Section 409A and the regulations
      and other guidance promulgated thereunder.  In the latter case,
      such payments shall not exceed the amount required to be included in
      income as the result of the failure to comply with the requirements of
      Code Section 409A.

            

    

     

    
      	
              13.14  

            	
              Acceleration of
      Payments. Except as specifically permitted herein or in other
      sections of this Agreement, no acceleration of the time or schedule of any
      payment may be made hereunder.  Notwithstanding the foregoing,
      payments may be accelerated hereunder by the Bank, in accordance with the
      provisions of Treasury Regulation Section 1.409A-3(j)(4) and any
      subsequent guidance issued by the United States Treasury
      Department.  Accordingly, payments may be accelerated, in
      accordance with requirements and conditions of the Treasury Regulations
      (or subsequent guidance) in the following circumstances: (i) as a result
      of certain domestic relations orders; (ii) in compliance with ethics
      agreements with the Federal government; (iii) in compliance with ethics
      laws or conflicts of interest laws; (iv) in limited cash-outs (but not in
      excess of the limit under Code Section 402(g)(1)(B)); (v) in the case of
      certain distributions to avoid a non-allocation year under Code Section
      409(p); (vi) to apply certain offsets in satisfaction of a debt of the
      Executive to the Bank; (vii) in satisfaction of certain bona fide disputes
      between the Executive and the Bank; or (viii) for any other purpose set
      forth in the Treasury Regulations and subsequent
  guidance.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECTION
XIV

     

    ESTABLISHMENT OF RABBI
TRUST

     

    The Bank
shall establish a rabbi trust into which the Bank shall contribute assets which
shall be held therein, subject to the claims of the Bank’s creditors in the
event of the Bank’s “Insolvency” as defined in the agreement which establishes
such rabbi trust, until the contributed assets are paid to the Executive and/or
his Beneficiary in such manner and at such times as specified in this
Agreement.  It is the intention of the Bank that the contributions to
the rabbi trust shall provide the Bank with a source of funds to assist it in
meeting the liabilities of this Agreement.  The rabbi trust and any
assets held therein shall conform to the terms of the rabbi trust agreement
which has been established in conjunction with the Agreement.  To the
extent the language in this Agreement is modified by the language in the rabbi
trust agreement, the rabbi trust agreement shall supersede this
Agreement.  Any contributions to the rabbi trust shall be made during
each Plan Year in accordance with the rabbi trust agreement.  The
amount of such contribution(s) shall be equal to the full present value of all
benefit accruals under this Agreement, if any, less: (i) previous contributions
made on behalf of the Executive to the rabbi trust, and (ii) earnings to date on
all such previous contributions.

     

    SECTION
XV

     

    AMENDMENT/
TERMINATION

     

    
      	
              15.1  

            	
              Amendment.  This
      Agreement shall not be amended, modified or terminated at any time, in
      whole or part, without the mutual written consent of the Executive and the
      Bank, and such mutual consent shall be required even if the Executive is
      no longer employed by the Bank.

            

    

     

    
      	
              15.2  

            	
              Complete
      Termination.  Subject to the requirements of Code Section
      409A, in the event of complete termination of the Agreement, the Agreement
      shall cease to operate and the Bank shall pay out to the Executive his
      benefit as set forth below.  Such complete termination of the
      Agreement shall occur only under the following circumstances and
      conditions:

            

    

     

    
      	
               
      

            	
              (a)

            	
              The
      Bank may terminate the Agreement within twelve (12) months of a corporate
      dissolution taxed under Code Section 331, or with approval of a bankruptcy
      court pursuant to 11 U.S.C. §503(b)(1)(A), provided that the amounts
      deferred under the Agreement are included in the Executive’s gross income
      in the latest of (i) the calendar year in which the Agreement terminates;
      (ii) the calendar year in which the amount is no longer subject to a
      substantial risk of forfeiture; or (iii) the first calendar year in which
      the payment is administratively
practicable.

            

    

     

    
      	
               
      

            	
              (b)

            	
              The
      Bank may terminate the Agreement within the thirty (30) days preceding a
      Change in Control (but not following a Change in Control), provided that
      the Agreement shall only be treated as terminated if all substantially
      similar arrangements sponsored by the Bank are terminated so that the
      Executive and all executives under substantially similar arrangements are
      required to receive all amounts of compensation deferred under the
      terminated arrangements within twelve (12) months of the date of the
      termination of the arrangements.  For these purposes, “Change in
      Control” shall be defined in accordance with the Treasury Regulations
      under Code Section 409A.

            

    

     

    
      	
               
      

            	
              (c)

            	
              The
      Bank may terminate the Agreement provided that: (i) the termination and
      liquidation does not occur proximate to a downturn in the financial health
      of the Bank; (ii) all arrangements sponsored by the Bank that would be
      aggregated with this Agreement under Treasury Regulations Section
      1.409A-1(c) if the Executive covered by this Agreement was also covered by
      any of those other arrangements are also terminated; (iii) no payments
      other than payments that would be payable under the terms of the
      arrangement if the termination had not occurred are made within twelve
      (12) months of the termination of the arrangement; (iv) all payments are
      made within twenty-four (24) months of the termination of the
      arrangements; and (v) the Bank does not adopt a new arrangement that would
      be aggregated with any terminated arrangement under Treasury Regulations
      Section 1.409A-1(c) if the Executive participated in both arrangements, at
      any time within three years following the date of termination of the
      arrangement.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECTION
XVI

     

    EXECUTION

     

    
      	
              16.1  

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

            

    

     

    
      	
              16.2  

            	
              This
      Agreement shall be executed in triplicate, each copy of which, when so
      executed and delivered, shall be an original, but all three copies shall
      together constitute one and the same
instrument.

            

    

     

    [Remainder
of page intentionally left blank]

     

    IN WITNESS WHEREOF, the Bank
and the Executive have caused this Agreement to be executed on the day and date
first above written.

     

    
      	 
      	 
      	
              PATHFINDER
      BANK:

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              By:

            	
              
                /s/
      Thomas W. Schneider

              

            
	 
      	 
      	 
      
	
              
                12/23/08

              

            	 
      	
              
                President
      and CEO

              

            
	
              DATE

            	 
      	
              (Title)

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              :

            	 
      	
              EXECUTIVE:

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              
                12/23/08

              

            	 
      	
              
                /s/
      Chris C. Gagas

              

            
	
              DATE

            	 
      	 
      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    RELATED
EXECUTIVE SUPPLEMENTAL RETIREMENT INCOME AGREEMENT

     

    FOR
CHRIS C. GAGAS

     

    CONDITIONS,
ASSUMPTIONS, AND SCHEDULE OF BENEFITS

     

    
      	
              1.

            	
              The
      Interest Factor for purposes of the Accrued Benefit Account shall be eight
      percent (8%) per annum, compounded
monthly.

            

    

     

    
      	
              2.

            	
              Benefit
      Age shall be seventy (70).

            

    

     

    
      	
              3.

            	
              Supplemental
      Retirement Income Benefit means an actuarially determined annual amount
      equal to Sixty Thousand Six Hundred and Eight-Six Dollars ($60,686) at age
      70.

            

    

     

    
      	
              4.

            	
              The
      annual “Survivor’s Benefit” shall be $60,686.00,
      subject to Subsection 2.5.

            

    

     

    Receipt
of the Supplemental Retirement Income Benefit (or the Survivor’s Benefit) shall
be subject to all provisions of this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    AMENDED
AND RESTATED

     

    EXECUTIVE
SUPPLEMENTAL RETIREMENT

     

    INCOME
AGREEMENT

     

    BENEFICIARY
DESIGNATION

     

    The
Executive, under the teams of the Amended and Restated Executive Supplemental
Retirement Income Agreement executed by the Bank, dated the 1st day of January,
2005, hereby designates the following Beneficiary(ies) to receive any guaranteed
payments or death benefits under such Agreement, following his
death:

     

    PRIMARY
BENEFICIARY:         Constance
Gagas

     

    SECONDARY
BENEFICIARY:  Anastasia, Charles, Gregory, Adam per
stirpes

     

    This
Beneficiary Designation hereby revokes any prior Beneficiary Designation which
may have been in effect.

     

    Such
Beneficiary Designation is revocable.

     

    DATE:
December 23, 2008

     

    
      	 
      	 
      
	 
      	 
      
	
              
                /s/
      Thomas W. Schneider

              

            	
              
                /a/
      Chris C. Gagas

              

            
	
              (WITNESS)

            	
              EXECUTIVE

            
	 
      	 
      
	 
      	 
      
	
              
                /s/
      Lorna Hall

              

            	 
      
	
              (WITNESS)

            	 
      

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    AMENDED
AND RESTATED

     

    EXECUTIVE
SUPPLEMENTAL RETIREMENT INCOME AGREEMENT

     

    NOTICE
OF ELECTION TO CHANGE FORM OF PAYMENT

     

    TO:           Bank

     

    Attention:

     

    I hereby
give notice of my election to change the form of payment of my Supplemental
Retirement Income Benefit, as specified below.  I understand that such notice, in
order to be effective, must be submitted on or before December 31,
2008.  You may not use this election
form to change your form of your benefit with respect to payments that are
scheduled to be made to you in 2008, or otherwise cause payments to be made to
you in 2008.

     

    
      	
               
      

            	
              ‪⁭

            	
              I
      hereby elect to change the form of payment of my benefits from monthly
      installments throughout my Payout Period to a lump sum benefit
      payment.

            

    

     

    
      	
               
      

            	
              ‪⁭

            	
              I
      hereby elect to change the form of payment of my benefits from a lump sum
      benefit payment to monthly installments throughout my Payout
      Period.  Such election hereby revokes my previous notice of
      election to receive a lump sum form of benefit
  payments.

            

    

     

    
      	 
      	 
      
	 
      
	
              Executive

            
	 
      	 
      
	 
      
	
              Date

            
	 
      	 
      
	 
      	 
      
	
              Acknowledged

            
	
              By:

            	 
      
	 
      	 
      
	
              Title:

            	 
      
	 
      	 
      
	
              Date

            	
              ________________________________________

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