Document:

<PAGE>

                                                                   EXHIBIT 10(c)

              STOCK APPRECIATION RIGHTS AWARD TERMS AND CONDITIONS

Your Stock Appreciation Rights Award (the "SARs" or the "Award") is made by
Applied Industrial Technologies, Inc., an Ohio corporation ("Applied"). For
purposes of these terms and conditions, employment by a parent, subsidiary, or
an affiliate of Applied shall be considered employment by Applied.

1.    GRANT OF SARs; EXERCISABILITY. The Award is governed by Applied's 1997
Long-Term Performance Plan (the "Plan"), including the policies adopted by the
Executive Organization & Compensation Committee of the Board of Directors (the
"Committee") under the Plan, and these terms and conditions. Upon valid
exercise, the Award entitles you to receive such number of shares of Applied
Common Stock ("Shares") that have a fair market value equal to the difference
(if positive) between the fair market value of (a) a Share on the date of
exercise over (b) the Base Price, multiplied by (c) the number of Shares with
respect to which the Award is exercised, subject to the following conditions:

      (a) Except as otherwise provided in Sections 2 and 7, your Award will be
      exercisable only if and after you have remained in Applied's continuous
      employ from the Award's grant date (the "Grant Date") to the vesting date
      of all or the specified portion of your Award. Your Award vests with
      respect to only 25% of the aggregate number of Shares to which it relates
      after one year of continuous employment from the Grant Date, which
      percentage increases to 50% after two years, to 75% after three years, and
      to 100% after four years of continuous employment from the Grant Date.

      (b) Your Award shall expire at the end of the 10-year period commencing
      with the Grant Date (the "Term"), or upon such earlier expiration or
      termination date as may be provided by Sections 2 and 7 below. The SARs
      shall not be exercisable thereafter.

2.    TERMINATION OF SARs. If, during the Term, you cease to be employed by
Applied for any reason, you may exercise your SARs, to the extent you were
entitled to exercise them immediately prior to your cessation of employment, at
any time within three months after the cessation of employment (but only during
the Term); provided, however, that (a) if you retire under an Applied retirement
plan, then the SARs shall become fully exercisable and, at any time within three
years after your retirement (but only during the Term), you may exercise the
SARs; (b) if your employment with Applied ceases due to your permanent and total
disability, then the SARs shall become fully exercisable and, at any time within
one year after your cessation of employment (but only during the Term), you may
exercise the SARs; and (c) if you die while employed by Applied, then the SARs
shall become fully exercisable and, at any time within one year after your death
(but only during the Term), the person entitled by will or applicable law to
exercise the SARs may do so.

Notwithstanding anything in these terms and conditions to the contrary, your
Award may be terminated or rescinded, and if applicable, you may be required to
immediately repay all Shares (and any dividends and distributions thereon)
issued pursuant to the Award within the previous six months (or any proceeds
thereof), if the Committee, or Applied's chief executive officer or president,
determines, in any of their sole discretion, that during your employment with
Applied or

<PAGE>

during the period ending six months following cessation of your employment, you
have committed an act inimical to Applied's interests. Acts inimical to
Applied's interest shall include (but are not limited to) insubordination,
willful inattention to duty or violation of Applied's published policies,
illegal or immoral acts, acts of fraud or dishonesty, solicitation of Applied's
employees, customers or vendors to terminate or alter their relationship with
Applied to Applied's detriment, unauthorized use or disclosure of information
regarding Applied's business, employees or customers, and competition with
Applied. The determination shall be effective at the time of your act and shall
be final and binding in all respects. The provisions of this Section 2 are a
fundamental term of your Award and your Award shall be deemed forfeitable
throughout the term of your employment and for six months thereafter.

3.    METHOD OF EXERCISE; RIGHTS OF HOLDER. During your life, your Award may be
exercised only by you, your guardian, or legal representative. Upon your death,
your Award may be exercised by the person entitled by will or by the laws of
descent and distribution.

Your SARs may be exercised by delivering to Applied at its principal executive
offices (directed to the attention of the Chief Financial Officer or Corporate
Secretary) a written notice (which may include facsimile transmission or
electronic mail), signed by you or such other person entitled to exercise the
SARs, of the election to exercise the SARs and stating the number of Shares as
to which the SARs are being exercised. The SARs shall be deemed exercised as of
the date Applied receives the notice. If the SARs are exercised, as provided
herein, by any person other than you, the notice shall be accompanied by
appropriate evidence of that person's right to exercise the SARs. As a condition
to your valid exercise of the SARs, you hereby consent to Applied withholding
from the Shares issuable upon exercise (if any), such number of Shares the fair
market value of which Applied determines to be equal to the amount required to
be withheld pursuant to applicable federal, state or local law, including tax
withholding requirements. Promptly following the proper exercise of the SARs,
Applied shall issue in the name of the person exercising the SARs, a certificate
representing the Shares due hereunder. Your SARs may be exercised only with
respect to a whole number of Shares, and may not be exercised in fractional
amounts.

Notwithstanding the foregoing and the restrictions on exercise contained in
Section 2, if a "Change in Control" (as defined in the Plan) of Applied occurs,
then your SARs then outstanding shall become fully exercisable as of the date of
the Change in Control.

In addition, following a Change in Control of Applied, no provision hereof shall
operate to reduce any time frame or to limit any economic benefit to which you
are entitled under this Award or the Plan, including the occurrence of any of
the transactions described in Section 7(a) through (c). In the event of the
occurrence of any of the transactions described in Section 7(a) through (c), the
provisions in Section 7 purporting to terminate your SARS shall not apply and
you shall have the option either to exercise your rights under Section 7 or to
deem the SARs assumed by the successor within the meaning of Section 424(a) of
the Internal Revenue Code, whichever is more favorable to you.

As an SAR holder, you shall have absolutely no rights as a shareholder, whether
before or after vesting of all or any portion of your Award.

4.    LIMITATIONS ON EXERCISE. Your SARs shall not be exercisable if such
exercise or the issuance of Shares pursuant to your Award would violate:

<PAGE>

      (a)   Any state securities law;

      (b)   Any registration or other requirements under the Securities Act of
      1933, as amended (the "Act"), the Securities Exchange Act of 1934, as
      amended, or any stock exchange's listing requirements; or

      (c)   Any other legal requirement of any governmental authority.

If your exercise of SARs is prevented by the terms of any of the foregoing
subsections, and the Term of the SARs expires, then you may, within 30 days
after Applied notifies you that your exercise is no longer prevented by this
Section 4, exercise the SARs to the extent they would have been exercisable but
for the operation of this Section 4.

Furthermore, if a registration statement with respect to Shares issuable upon
exercise of the SARs is not in effect or if Applied's counsel otherwise deems it
necessary or desirable in order to avoid possible violations of the Act, Applied
may require, as a condition to its issuance and delivery of certificates for the
Shares, the delivery to Applied of a commitment in writing by the person
exercising the SARs that (i) at the time of the exercise it is his intention to
acquire the Shares for his own account for investment only and not with a view
to, or for resale in connection with, the distribution thereof; (ii) the person
understands that the Shares may be "restricted securities" as defined in Rule
144 issued under the Act; and (iii) any resale, transfer or other disposition of
the Shares will be accomplished only in compliance with Rule 144, the Act, or
other or subsequent rules and regulations thereunder. Applied may place on the
certificates representing the Shares a legend reflecting that commitment and
Applied may refuse to permit transfer of the Shares until it has been furnished
evidence satisfactory to it that no violation of the Act or the rules and
regulations thereunder would be involved in the transfer.

5.    NO GUARANTY OF EMPLOYMENT. The Award is not a guaranty of employment or
commitment by Applied of continued employment. Nothing in the Award or these
terms and conditions alters, limits or restricts any right Applied would
otherwise have to terminate or modify the terms of your employment.

6.    NONASSIGNABILITY. The Award is not assignable or transferable, in whole or
in part, and may not be otherwise disposed of by you, other than by will or by
the laws of descent and distribution or with the prior written consent of
Applied.

7.    LIQUIDATION, DISSOLUTION, MERGER, SALE OF SUBSTANTIALLY ALL ASSETS. If (a)
Applied is to be merged, consolidated or reorganized into or with another entity
so that Applied is not the surviving corporation and, immediately after such
event, the holders of Shares immediately prior to the event hold, in the
aggregate, less than a majority of the combined voting power of the then
outstanding securities of the new entity, (b) Applied is to be dissolved or
liquidated, or (c) substantially all of Applied's assets are to be sold, then
the Committee shall give you 30 days' prior written notice. Upon the giving of
that notice, if you are employed by Applied, then the SARs shall become fully
vested and exercisable. Within the 30-day period (but only during the Term), you
shall have the right to exercise your SARs. Thereafter, notwithstanding any
other provision of these terms and conditions, the SARs shall expire, unless
"assumed" by another corporation within the meaning of Section 424(a) of the
Internal Revenue Code.

<PAGE>

8.    ADJUSTMENTS. In the event (a) of a stock dividend or stock split or (b)
the Shares are changed into or exchanged for a different number or kind of
securities of Applied or another entity, then the Shares purchasable or the Base
Price hereunder shall be equitably adjusted so that the SARs represent the right
to acquire Shares or the number and kind of other securities that are
economically equivalent to what the Shares would have represented had the SARs
been fully exercised immediately preceding such event.

In the event other changes or events relating to the Shares fundamentally change
the value of the Shares or securities for which the SARs are exercisable, then
the Committee may make, in its sole discretion, such adjustments in the terms of
the SARs as the Committee may determine is equitably required by the change or
event.

9.    COMMITTEE AUTHORITY. The Committee shall have authority, subject to the
Plan's express provisions, to construe these terms and conditions and the Plan,
to establish, amend and rescind rules and regulations relating to the Plan, and
to make all other determinations in the Committee's judgment necessary or
desirable for the Plan's administration. The Committee may correct any defect or
supply any omission or reconcile any inconsistency in the Plan or these terms
and conditions in the manner and to the extent it shall deem expedient to carry
the Plan into effect. All Committee action under this Section shall be
conclusive for all purposes.

10.   RELATIONSHIP TO THE PLAN. In the event of any inconsistency between these
terms and conditions and any provision of the Plan or the Committee's policies,
the Plan or the policies shall govern. Terms used but not otherwise defined in
these terms and conditions shall have the meaning ascribed them in the Plan.
Notwithstanding any provisions hereof, these terms and conditions and the SARs
granted shall be subject to all of the Plan's provisions in effect from time to
time, which are incorporated herein by reference.

                                                         (July 2004 -- officers)<PAGE>
                                                                   EXHIBIT 10.15
(KEEFE, BRUYETTE & WOODS LOGO)

May 16, 2005

Mr. Peter Humphrey
Chairman, President, & Chief Executive Officer
Financial Institutions, Inc.
220 Liberty Street
Warsaw, NY 14569-0227

Dear Peter:

Financial Institutions, Inc. ("FII"), as agent for National Bank of Geneva, Bath
National Bank, Wyoming County Bank and Fist Tier Bank & Trust Company (the
"Banks") hereby engages Keefe Bruyette & Woods, Inc. ("KBW") as its exclusive
advisor, to exercise its best efforts to arrange a sale of all or a portion of
approximately $118 million of Commercial Loans severally held by the Banks
("Phase I Sale"), and upon approval of the Banks' boards an additional sale of
all or a portion of approximately $56 million of Commercial Loans severally held
by the Banks ("Phase II Potential Sale", and collectively, the "Portfolio"),
including providing the services listed below under "Scope of Services." KBW
shall have the exclusive right to obtain commitments from one or more Purchasers
to purchase all or a portion of the Portfolio, from the date of the Agreement
until the expiration hereof, including any extensions pursuant to the terms
hereof. KBW hereby accepts such appointment subject to the terms and conditions
set forth herein:

SCOPE OF SERVICES TO BE PROVIDED

(1) PREPARATION FOR SALE. KBW will work in concert with FII and the Banks to
review Portfolio data necessary to market a Portfolio of this type. If requested
by FII, KBW's staff and Subcontractor will assist FII and the Banks to prepare
the loan files for investor review by obtaining any additional documentation
(e.g., pay histories, title searches, lien records) necessary to maximize the
value of the Portfolio, and checking the files for completeness and organization
necessary to support the representations and warranties recommended for this
sale.

KBW will also oversee the scanning of all documentation pertinent to the sale
for the purpose of providing due diligence materials to potential investors via
a secure, fully integrated information management web site.

(2) PORTFOLIO POOLING AND STRATIFICATION. KBW will sort and stratify the
Portfolio into market-homogeneous pools to target investors with specific buying
criteria. KBW will assist FII and the Banks in the selection and extraction of
significant portfolio-level data, and will perform detailed portfolio analysis
for inclusion in the Offering Memorandum.

(3) PREPARATION OF MARKETING MATERIALS. KBW will prepare a "Teaser" piece (a
one-page sale announcement) that will include (i) a brief description of the
Portfolio, (ii) an outline of the timetable and bidding procedures for the sale,
and (iii) a Confidentiality Agreement, each in form and substance satisfactory
to FII and its counsel.

Investors who execute a Confidentiality Agreement will be sent a detailed
Offering Package, also prepared by KBW, which will include an Executive Summary,
Portfolio Analysis, detailed Individual Asset Summaries, Offering Procedures and
a form of Purchase and Sale Agreement, each in form and substance satisfactory
to FII and its counsel.

KBW will prepare presentations on the possible range of values for the Portfolio
and will present these findings separately to the various Boards of Directors of
FII, and each of the Banks.

(4) MARKETING. KBW will conduct an extensive marketing effort to facilitate the
sale of the Portfolio. KBW salespeople will contact a targeted list of accounts
which have bid on similar assets in the past, and which includes those accounts
that KBW reasonably believes are the most likely to be qualified bidders on the
Portfolio under current market

Keefe, Bruyette & Woods o 787 Seventh Avenue o New York, NY 10019
212.887.7760 o Toll Free 800.966.1559

<PAGE>
(KEEFE, BRUYETTE & WOODS LOGO)

conditions; KBW will also arrange any appropriate advertising or publicity of
the sale on FII's behalf, with FII's prior approval.

(5) COORDINATION OF LEGAL DOCUMENTATION. KBW will assist FII and FII's counsel
in developing terms for Purchase and Sale Agreements governing the sale, and
will advise FII on matters of timing and document transfer.

(6) HANDLING INVESTOR INQUIRY. KBW will act as the primary clearinghouse for
investor inquiry on loan and collateral questions which arise during the sale,
and will provide answers to any questions for which the information is on hand.
To the extent that inquiries require response from FII or any of the Banks, KBW
will handle initial inquiries for direction to the proper FII personnel.

(7) OVERSIGHT OF INVESTOR DUE DILIGENCE. Most investor due diligence and file
review will be conducted remotely via a secure web site managed by KBW. If a
potential investor should request, and if FII deems it necessary, a KBW staff
member and/or subcontractor will oversee investor due diligence file review
on-site at FII's offices.

(8) SELECTION OF WINNING BIDDER(S). In addition to recommending the highest
qualified bid(s), KBW will screen all bidders for financial and operational
ability to close. Conditions of any bid will also be part of KBW's evaluation.
FII (and the Banks, with respect to each of their loans) will have the right to
accept or reject in their sole discretion any and all bids.

(9) COORDINATION OF CLOSING. The KBW team will work closely with FII, the Banks
and the winning Bidder(s) to ensure that the sale closes expeditiously. KBW will
coordinate bid acceptance, assist FII and the Banks in any negotiations
necessary relative to the terms of the sale, reconcile closing balances and
prepare a settlement statement of amounts due at closing. If necessary, KBW will
assist in preparing the loan files for delivery to the winning Bidder(s). FII
will be responsible for the transfer of loan data, documentation and servicing.

TERMS OF THE AGREEMENT

(1) FEES AND EXPENSES:

DISPOSITION FEE: At each closing of a sale of Portfolio Loans, FII will pay to
KBW a fee ("Disposition Fee") equal to 1.5% of the gross proceeds from the sale
of the Portfolio or any portion thereof, including any borrower settlements
(payoffs) received after March 14, 2005. At each subsequent closing a
Disposition Fee will be paid on the gross proceeds of loans sold and on any
borrower settlements (payoffs) subsequent to the prior closing. FII may reduce
the Disposition Fee paid to KBW at each closing by an amount equal to 0.20% (20
basis points) of the principal amount of loans on which KBW is paid a
Disposition Fee at such closing. (including borrower settlements (payoffs)) to
reflect a credit for certain expenses paid or payable by FII which were incurred
by KBW under this engagement and its engagement under a letter agreement between
KBW and FII dated March 14, 2005; provided that, at first closing the aggregate
Disposition Fee after any such reduction shall not be less than $450,000.

EXPENSES: In connection with this engagement, FII will be responsible for all
fees and expenses, including all cost of travel and lodging for KBW personnel
and other out-of-pocket expenses including, but not limited to third party and
subcontractor expenses and other costs incurred by KBW, with the following
exception. Notwithstanding the foregoing, in the event that a closing occurs for
the sale of Portfolio loans, KBW will reimburse the Company, upon receipt of a
sufficiently itemized statement, for fees and expenses of Edwards and Angell LLP
incurred by the Company in connection with the sale of Portfolio loans. Such
reimbursement shall be limited to the amount by which aggregate Disposition Fees
paid or payable exceeds $450,000, subject to a maximum reimbursement amount of
$50,000. Reimbursement for such legal fees may be made by a reduction of such
amount from the Disposition Fee paid by the Company to KBW.

(2) SELLER'S APPROVAL OF MARKETING MATERIALS: FII will have the right to approve
in advance all marketing materials, including the Teaser piece, Offering
Memorandum, advertisements or any other marketing materials KBW intends to send
to prospective bidders/purchasers of the Portfolio. KBW will submit these
materials to FII for approval prior to sending out such materials.

Keefe, Bruyette & Woods o 787 Seventh Avenue o New York, NY 10019
212.887.7760 o Toll Free 800.966.1559

<PAGE>
(KEEFE, BRUYETTE & WOODS LOGO)

(3) OBLIGATIONS LIMITED: FII acknowledges that the descriptions of the Portfolio
and any underlying collateral have been furnished by FII and the Banks and are
not representations by KBW. KBW shall be under no obligation to make an
independent investigation or inquiry as to the correctness or completeness of
any information or data given to KBW, and shall have no liability in regard
thereto. KBW will make no representations or warranties (either orally or in
writing) regarding the Portfolio to prospective purchasers of the Portfolio.
FII will have the right to review and approve in advance any information and
marketing materials distributed to prospective investors or other third parties.

(4) EXCLUSIVITY; CONFIDENTIALITY: FII agrees that KBW shall have the exclusive
right to solicit purchasers for the Portfolio during the term and any
extensions hereof. Except for any required recording in connection with sales,
FII and KBW will keep confidential and will not, without written consent,
divulge to any other person the identity of any prospective purchaser
introduced by KBW, except to the extent necessary in working with the Banks,
legal counsel and auditors of FII or the Banks, taxing authorities or government
agencies. This agreement does not modify or terminate the confidentiality
agreement between KBW and FII, dated March 4, 2005. FII will not disclose this
engagement letter nor the terms herein, except as required by applicable
securities law.

(5) TERMINATION; SUBSEQUENT CLOSINGS: This Agreement may not be terminated
prior to 120 days from the date hereof, except that FII may terminate this
Agreement at any time on notice to KBW if, in the judgment of FII, KBW has
failed to perform or is not performing its obligations under this Agreement.
After the first 120 days, this Agreement may be terminated with or without cause
on 10 business days written notice from one party to the other. Notwithstanding
such termination, if within 12 months of the date of such termination FII or any
of the Banks shall enter into an agreement to sell the Portfolio or any portion
thereof to any purchaser introduced by KBW to FII during the term hereof, KBW
shall be deemed to have earned the Disposition Fee set forth in Section (1)
hereof, which shall be payable on the date of settlement of such sale.

(6) INDEMNIFICATION: FII will indemnify KBW and hold it harmless against any and
all losses, claims, damages or liabilities to which KBW may become subject
arising in any manner out of or in connection with the Portfolio, including,
without limitation, the marketing and sale thereof and with FII's provision of
information to KBW; provided however, that such indemnity shall not apply in the
event it is finally judicially determined that the loss was primarily caused by
KBW's willful misconduct or gross negligence. FII shall reimburse KBW for legal
or other expenses reasonably incurred by KBW in connection with investigating,
preparing to defend or defending any lawsuits, claims or other proceedings
arising in any manner out of, or in connection with, the rendering of services
hereunder. The Banks have separately agreed to contribute to FII their
proportionate share (based on loans sold) of any indemnification payments made
by FII.

(7) ADVERTISING AND DISCLOSURE: FII agrees that upon the successful conclusion
of this engagement, KBW shall have the right to place advertisements in
financial and other newspapers or journals at its own expense describing its
services to FII hereunder, subject to FII's prior written approval for each
individual advertisement, which approval shall not be unreasonably withheld,
conditioned or delayed. KBW will not disclose in any such advertising the
purchase price(s) or other financial terms of any sale consummated under the
terms of this Agreement. Effective the date of this Agreement, KBW may list FII
as a client.

(8) MISCELLANEOUS: This Agreement is made solely for the benefit of the parties
hereto, and no other person shall acquire or have any right under or by virtue
of this Agreement, except that each of the Banks is a third party beneficiary to
this Agreement. This Agreement shall be governed by and construed and enforced
in accordance with the laws of the State of New York without regard to its
conflict-of-laws principles and may be executed in several counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Nothing contained herein shall be deemed or
construed to create a partnership or joint venture between the parties hereto,
and KBW's services shall be rendered to FII as a contractor. In any legal
proceeding brought under or with relation to this contract or transaction, the
prevailing party shall be entitled to recover court costs and any reasonable
attorneys' fees from the non-prevailing party. The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provisions of this Agreement, which
shall remain in full force and effect.

Keefe, Bruyette & Woods o 787 Seventh Avenue o New York, NY 10019
212.887.7760 o Toll Free 800.966.1559

<PAGE>

(KEEFE, BRUYETTE & WOODS LOGO)

We look forward to moving ahead with FII on this transaction. Please indicate
your acceptance of this Agreement by countersigning in the space provided below.

Sincerely yours,

KEEFE, BRUYETTE & WOODS, INC.                FINANCIAL INSTITUTION, INC.

BY: /s/ MICHAEL MACDONALD                    BY: /s/ PETER G. HUMPHREY
    -----------------------------                -------------------------------

Name: Michael MacDonald                      Name: Peter G. Humphrey
      ---------------------------                  -----------------------------

Title: Managing Director                     Title: Chairman, President & CEO
       --------------------------                   ----------------------------

Accepted and Agreed:

BATH NATIONAL BANK                           NATIONAL BANK OF GENEVA

By: /s/ DOUGLAS MCCABE                       By: /s/  MARTIN K. BIRMINGHAM
    -----------------------------                -------------------------------

Name: Douglas McCabe                         Name: Martin K. Birmingham
      ---------------------------                  -----------------------------

Title: President and CEO                     Title: President and CEO
       --------------------------                   ----------------------------

Keefe, Bruyette & Woods o 787 Seventh Avenue o New York, NY 10019
212.887.7760 o Toll Free 800.966.1559

<PAGE>
(KEEFE, BRUYETTE & WOODS LOGO)

FIRST TIER BANK & TRUST COMPANY              WYOMING COUNTY BANK

By: /s/ GARY M. ROUGEAU                      By: /s/ JAMES T. RUDGERS
    -----------------------------                -------------------------------

Name: Gary M. Rougeau                        Name: James T. Rudgers
      ---------------------------                  -----------------------------

Title: President/CEO                         Title: Acting CEO. WYCO
       --------------------------                   ----------------------------

Keefe, Bruyette & Woods o 787 Seventh Avenue o New York, NY 10019
212.887.7760 o Toll Free 800.966.1559

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00088-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00088-of-00352.parquet"}]]