Document:

Daniel J. O'Toole Employment Protection  Agreement

 EXHIBIT 10.4 
  
 EMPLOYMENT PROTECTION AGREEMENT 
  
 This EMPLOYMENT PROTECTION AGREEMENT (the “Agreement”), made as of this 26th day of August, 2003, by and among SBU
Bank, a Federally chartered savings bank having its principal place of business in Utica, New York (the “Bank”), Partners Trust Financial Group, Inc., a Federal corporation owning all of the issued and outstanding shares of capital stock
of the Bank (“PRTR”) (the Bank and PRTR, collectively, the “Employers”), and Daniel J. O’Toole, an individual residing in Whitesboro, New York (the “Employee”). 
  
 WHEREAS, the Employee is currently serving as the Senior Vice President and
Chief Credit Officer of the Bank; and 
  
 WHEREAS, the Boards of
Directors of the Employers (the “Boards”) believe that it is in the best interests of the Employers to encourage the Employee’s continued employment with and dedication to the Bank in the face of potentially distracting circumstances
arising from the possibility of a change of control of the Employers, although no such change is now contemplated; and 
  
 WHEREAS, the Boards have approved and authorized the entry into this Agreement with the Employee; and 
  
 WHEREAS, the parties desire to enter into this Agreement setting forth the
terms and conditions for the payment of special compensation to the Employee in the event of a termination of the Employee’s employment in connection with or as the result of a change of control of the Employers; 
  
 NOW, THEREFORE, it is AGREED as follows: 
  
 1. Term. The initial term of this Agreement shall be for
a three-year period commencing on the date of this Agreement. Subject to annual review and approval by the Boards, this Agreement may be renewed by written notice to the Employee for one additional year on the first and each subsequent anniversary
of the date of this Agreement. References herein to the term of this Agreement shall include the initial term and any additional years for which this Agreement is renewed. 
  
 2. Termination of Employment in Connection with a Change of Control. 
  
 (a) If during the term of this Agreement there is a
“Change of Control” (as defined below) and the Employee’s employment is terminated, voluntarily by the Employee with “Good Reason” (as defined below) or involuntarily without “Cause” (as defined below), in either
case (i) within one year after such 

 Change of Control, (ii) concurrently therewith or (iii) before and in connection with such Change of
Control (including, without limitation, after PRTR (as referred to for purposes of paragraph 2(d) below) has entered into an agreement or engaged in substantive negotiations with respect to such Change of Control) then, subject to Sections 2(e) and
(f) below, the following shall apply: 
  
 (i)
Concurrently with such termination of employment, the Employers shall pay to the Employee a lump sum cash payment equal to (A) the Employee’s base cash compensation from the Bank in effect immediately before the Change of Control or (B) the
annual base cash compensation paid to the Employee by the Bank during the calendar year preceding the year in which the Change of Control occurs; and 
  
 (ii) For one year after such termination, the Employers shall continue in effect all medical, prescription, dental and life insurance
plans for the benefit of the Employee and, if applicable, the Employee’s family, which would have been provided to them if the Employee’s employment had not been terminated; provided, however, that if the Employee becomes reemployed with
another employer and is eligible to receive medical, prescription or dental benefits under another employer provided plan, the medical, prescription and dental benefits described herein shall be secondary to those provided under such other plan
during such applicable period of eligibility. 
  
 Payments under this Section
2(a) shall be in lieu of any amount that may be otherwise owed to the Employee as damages for the loss of employment. Payments under this Section 2(a) shall not be reduced by any compensation which the Employee may receive from other employment with
another employer after termination of the Employee’s employment with the Bank. No payment hereunder shall affect the Employee’s entitlement to any vested retirement benefits or other compensation payments. 
  
 (b) For purposes of this Agreement, “Good Reason”
shall mean (i) a material reduction in the Employee’s position, authority, duties, responsibilities; (ii) a reduction in the Employee’s compensation or perquisites; or (iii) any requirement by the Bank without the written consent of the
Employee that the Employee relocate to a place more than 60 miles from Utica, New York to perform his or her duties. To establish that a voluntary termination was with Good Reason, the Employee shall provide the Employers with a written notice of
resignation setting out the reasons why the Employee believes that Good Reason exists. Unless the Bank, within 30 days of the date of such notice of resignation, shall reject the Employee’s statement that Good Reason exists, the Employee shall
be conclusively deemed to have voluntarily resigned with Good Reason. If the Bank rejects the Employee’s statement that Good Reason exists, the Bank shall have the burden of proving that such rejection of the Employee’s statement was
proper. 

 (c) For purposes of this Agreement, “Cause” shall mean the Employee’s (1)
personal dishonesty, incompetence, willful misconduct; (2) breach of fiduciary duty involving personal profit, intentional failure to perform material stated duties; (3) willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses); (4) being a specific subject of a final cease and desist order from, written agreement with, or other order or supervisory direction from, any federal or state regulatory authority; or (5) conduct tending to bring
the Bank or any of its subsidiaries into substantial public disgrace or disrepute. In determining incompetence, the acts or omissions shall be measured against standards generally prevailing in the financial institutions industry; provided, it shall
be the burden of the Employers to prove the alleged acts and omissions and the prevailing nature of the standards the Employers shall have alleged are violated by such acts and/or omissions. 
  
 (d) For purposes of this Agreement, a “Change of
Control” shall mean: 
  
 (1) The acquisition
by any individual, entity or group (within the meaning of Section 13(d) (3) or 14(d) (2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of 20% or more of either (i) the then outstanding shares of common stock of PRTR (including, for purposes of this paragraph 2(d), any company into which PRTR may merge as part of the reorganization of
Partners Trust, MHC and its affiliates to a converted stock entity) (the “Outstanding Company Common Stock”), or (ii) the combined voting power of the then outstanding voting securities of PRTR entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this subsection (1), the following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from PRTR or Partners
Trust, MHC, (ii) any acquisition by PRTR or Partners Trust, MHC, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by PRTR or Partners Trust, MHC, the Bank or any other corporation controlled by PRTR or
Partners Trust, MHC, or (iv) any acquisition by any corporation pursuant to a transaction that complies with clauses (i), (ii) and (iii) of subsection (3) of this Section 2(d); or 
  
 (2) Individuals who, as of the date of hereof, constitute the Board of Directors of PRTR (the
“Incumbent Board”) cease for any reason to constitute at least a majority of such Board of Directors (the “PRTR Board”); provided, however, that any individual becoming a director subsequent to the date of hereof whose election,
or nomination for election by PRTR’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose 

 initial assumption of office occurs as a result of an actual or threatened election contest with respect
to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the PRTR Board; or 
  
 (3) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or
substantially all of the assets of PRTR (a “Business Combination”), in each case, unless, following such Business Combination, (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of
the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of, respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns PRTR or all or substantially all of PRTR’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such
Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related
trust) of PRTR, the Bank, such corporation resulting from such Business Combination or a corporation controlled by any of them) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of
the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (iii) at least
a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for
such Business Combination; or 
  
 (4) Approval by
the shareholders of PRTR of a complete liquidation or dissolution of PRTR without the establishment of a successor corporation. 
  
 (e) (1) Notwithstanding any other provision of this Agreement or of any other agreement, contract, or understanding heretofore or
hereafter entered into by the Employee and the Employers, except an agreement, contract, or understanding hereafter entered into that expressly modifies or excludes application of this Section 2(e) (the “Other Agreements”), and
notwithstanding any formal or informal plan or other arrangement for the direct or indirect provision of compensation to the Employee (including groups or classes of participants or 

 beneficiaries of which the Employee is a member), whether or not such compensation is deferred, is in
cash, or is in the form of a benefit to or for the Employee (a “Benefit Plan”), the Employee shall not have any right to receive any payment or other benefit under this Agreement, any Other Agreement, or any Benefit Plan if such payment or
benefit, taking into account all other payments or benefits to or for the Employee under this Agreement, all Other Agreements, and all Benefit Plans, would cause any payment to the Employee under this Agreement to be considered a “parachute
payment” within the meaning of Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended (a “Parachute Payment”). In the event that the receipt of any such payment or benefit under this Agreement, any Other Agreement, or any
Benefit Plan would cause the Employee to be considered to have received a Parachute Payment under this Agreement, then the Employee shall have the right, in the Employee’s sole discretion, to designate those payments or benefits under this
Agreement, any Other Agreements, and/or any Benefit Plans, which should be reduced or eliminated so as to avoid having the payment to the Employee under this Agreement be deemed to be a Parachute Payment. 
  
 (2) All determinations required to be made under this
Section 2(e), including whether and when the payments and benefits referred to in Section 2(e)(1) shall be reduced, shall be made by KPMG LLP or such other certified public accounting firm as may be designated by the Employee and shall be reasonably
acceptable to the Employers (the “Accounting Firm”) which shall provide detailed supporting calculations both to the Employers and the Employee within 15 business days of the receipt of notice from the Employee that such a determination is
required, or such earlier time as is requested by the Employers. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting a change in the ownership or effective control (as defined for
purposes of Section 280G of the Code) of the Employers, the Employee shall appoint another nationally recognized accounting firm which is reasonably acceptable to the Employers to make the determinations required hereunder (which accounting firm
shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Employers. Any determination by the Accounting Firm shall be binding upon the Employers and the Employee. As a
result of the uncertainty in the application of Section 280G of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that additional adjustments may be required. The Employee shall promptly repay to the
Employers any amount that is later determined to constitute a Parachute Payment, with interest at 120% of the applicable federal rate, as defined for purposes of Section 280G of the Code and all such amounts shall be treated as loans from the
Employers to the Employee. 
  
 (f)
Notwithstanding any other provision in this Agreement, (i) the Employers may terminate or suspend this Agreement and the employment of the Employee, as if such termination were for Cause, to the extent required by the 

 applicable laws of the State of New York related to banking, by applicable federal law relating to
deposit insurance or bank holding companies or by regulations or orders issued by the New York State Banking Department, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation or other state or federal
banking regulatory agency having jurisdiction over PRTR or the Bank and (ii) no payment shall be required to be made to or for the benefit of the Employee under this Agreement to the extent such payment is prohibited by applicable law, regulation or
order issued by a banking agency or a court of competent jurisdiction; provided, that it shall be the Employers’ burden to prove that any such action was so required. 
  
 3. No Assignments. This Agreement is personal to each of the parties hereto. No party may assign or delegate
any rights or obligations hereunder without first obtaining the written consent of the other party hereto. However, in the event of the death of the Employee, all rights to receive payments hereunder shall become rights of the Employee’s
estate. Subject to the provisions hereof restricting assignment, this Agreement shall be binding upon the parties hereto and shall inure to the benefit of the parties and their respective heirs, devisees, executors, administrators, legal
representatives, successors and assigns. 
  
 4. Amendments
or Additions; Action by Board of Directors. No amendments or additions to this Agreement shall be binding unless in writing and signed by both parties hereto. The prior approval by a majority affirmative vote of the full Boards shall be
required in order for the Employers to authorize any amendments or additions to this Agreement. 
  
 5. Section Headings. The section headings used in this Agreement are included solely for convenience and shall not affect, or be used in
connection with, the interpretation of this Agreement. 
  
 6.
Governing Law. This Agreement shall be governed by the laws of the United States to the extent applicable, and otherwise by the laws of the State of New York applicable to contracts entered into and performed wholly within its borders.

  
 7. Entire Agreement. This Agreement constitutes
the entire agreement between the parties respecting the employment of the Employee, there being no representations, warranties or commitments except as set forth herein. 
  
 8. Reserved. 
  
 9. Notices. All notices, demands, requests, or other communications which may be or are required to be given, served, or sent by any party
to any other party pursuant to this Agreement shall be in writing and shall be hand delivered, sent by overnight courier or mailed by first-class, registered or certified mail, return 

 receipt requested, postage prepaid, or transmitted by telegram, telecopy or telex, addressed as follows: 
  

	 	(i)	If to the Employers: 

  
 Partners Trust Financial Group, Inc. 
 233 Genesee Street 
 Utica, NY 13501 
 Attn: Chief Executive Officer 
  
 with a copy (which shall not constitute notice) to: 
  
 Stuart G. Stein 
 Hogan & Hartson, L.L.P. 
 555 13th Street, N.W. 
 Washington, DC 20004-1109 
 Fax: 202/637-5910 
  

	 	(ii)	If to the Employee: 

  
 Daniel J. O’Toole 
 109 Bedford Drive 
 Whitesboro, NY 13492 
  
 Each party may designate by notice in writing a new address to which any
notice, demand, request or communication may thereafter be so given, served or sent. Each notice, demand, request, or communication which shall be hand delivered, sent, mailed, telecopied or telexed in the manner described above, or which shall be
delivered to a telegraph company, shall be deemed sufficiently given, served, sent, received or delivered for all purposes at such time as it is delivered to the addressee (with the return receipt, the delivery receipt, or (with respect to a
telecopy or telex) the answerback being deemed conclusive, but not exclusive, evidence of such delivery) or at such time as delivery is refused by the addressee upon presentation. 
  
 10. Severability. The invalidity or unenforceability of any one or more provisions of this Agreement shall not
affect the validity or enforceability of the other provisions of this Agreement, which shall remain in full force and effect. 
  
 11. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be an original and all of which shall be
deemed to constitute one and the same instrument. 

 IN WITNESS WHEREOF, the undersigned have duly executed and delivered this Agreement, or have caused this
Agreement to be duly executed and delivered on their behalf, as of the date written above. 
  

									
	SBU Bank	 	 	 	 	 	 
					
	 By:
	 	/s/    John A. Zawadzki	 	 	 	Attest:	 	 
	 	 	
	 	 	 	 	 	

	 	 	(President)	 	 	 	 	 	(Secretary)
				
	Partners Trust Financial Group, Inc.	 	 	 	 	 	 
					
	 By:
	 	/s/    John A. Zawadzki	 	 	 	 Attest:
	 	 
	 	 	
	 	 	 	 	 	

	 	 	(President)	 	 	 	 	 	(Secretary)

  

			
	Employee
		
	 	 	/s/    Daniel J. O’TooleHoward W. Sharp  Employment Protection  Agreement dated 12/23/2003

 EXHIBIT 10.5 
  
 EMPLOYMENT AGREEMENT 
  
 This AGREEMENT is made as of this 23rd day of December, 2003, by and among SBU BANK, a Federally chartered capital stock savings bank having its principal
place of business in Utica, New York (the “Bank”), PARTNERS TRUST FINANCIAL GROUP, INC., a Federal corporation owning all of the issued and outstanding shares of capital stock of the Bank (“Partners Trust”) (the Bank and Partners
Trust, collectively, the “Employers”), and HOWARD W. SHARP, an individual residing in Syracuse, New York (the “Executive”). 
  
 WHEREAS, the Executive intends to serve as a senior executive of the Employers; 
  
 WHEREAS, the Boards of Directors of the Employers (collectively, the “Boards”), have approved and authorized the
Employers to enter into this Agreement with the Executive; 
  
 WHEREAS, the parties desire to enter into this Agreement, setting forth the terms and conditions for the employment relationship of the Executive with the Employers; 
  
 NOW, THEREFORE, in consideration of the foregoing and the mutual promises, covenants and agreements set forth in this
Agreement, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties agree as follows: 
  
 1. Employment. 
  
 (a) Term. The term of employment under this Agreement shall commence on the Closing Date as such term is defined under the Agreement and Plan of
Merger (the “Merger Agreement”) by and between Partners Trust Financial Group, Inc., SBU Bank, BSBB Acquisition Corporation, Partners Trust, MHC and BSBB Bancorp, Inc., dated December 23, 2003, and end on the last day of the calendar
quarter in which the Executive attains age 60 (the “Employment Term”). 
  
 (b) Duties. The Executive is to be employed as a senior executive of the Employers for the Employment Term. As a senior executive of the Employers, the Executive shall report directly to the Chief Executive
Officer of the Employers and shall have such duties as are commensurate and consistent with the Executive’s position and experience. 
  
 2. Compensation and Benefits. 
  
 (a) Base Salary. During the Employment Term, the Executive shall be paid a base salary at an annualized rate of not less than U.S. $450,000.00 (the
“Base Salary”), payable in accordance with the Employers’ regular payroll practices for its executive employees or if the Employers so elect payable on the first business day of each calendar quarter during the Employment Term.

  
 (b) Benefit Plans. The Executive shall be eligible to
participate in any Employer maintained employee pension benefit plans (as that term is defined under Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended), group life insurance plans, medical plans, dental plans, long-term
disability plans, business travel insurance programs and 

 other fringe benefit plans or programs maintained by the Employers for the benefit of its employees pursuant to the terms
of such plans. The Executive’s participation in any such benefit plans and programs shall be based on, and subject to satisfaction of, the eligibility requirements and other conditions of such plans and programs; provided, however, that the
Executive shall receive credit for service prior to the Closing Date as provided for in the Merger Agreement. If the Executive’s employment by the Employers shall cease for any reason other than by voluntary termination (as described in Section
3(b) below) or for “Cause” (defined in Section 3(e) below), the Executive shall receive continued group life, health, dental, accident and long term disability insurance coverage for the remaining Employment Term, equivalent to the
coverage to which he would have been entitled under such plans (as in effect on the date of his termination of employment) if he had continued working for the Employers during the remaining Employment Term, but taking into account any coverage
provided from any subsequent employer. On the Closing Date, all stock options to acquire shares of BSB common stock granted prior to the date hereof shall immediately vest in full. 
  
 3. Termination. 
  
 The Executive’s employment by the Employers shall be subject to termination as follows: 
  
 (a) Expiration of the Employment Term. The Executive’s
employment with the Employers shall not terminate prior to the expiration of the Employment Term. 
  
 (b) Voluntary Termination. The Executive may terminate this Agreement upon not less than 60 days prior written notice delivered to the Employers,
in which event the Executive shall be entitled only to the compensation and benefits the Executive has earned or accrued through the effective date of the voluntary termination (the “Accrued Obligations and Other Benefits”). 
  
 (c) Termination Upon Death. This Agreement shall terminate upon the
Executive’s death. In the event this Agreement is terminated as a result of the Executive’s death, the Employers shall pay the Executive’s Base Salary for the remainder of the Employment Term to the Executive’s estate in a lump
sum and to pay or provide any other Accrued Obligations or Other Benefits, which shall include death benefits on the same basis as provided to similarly situated executives of the Employers. 
  
 (d) Termination Upon Disability. The Employers may terminate this
Agreement upon the Executive’s disability. For purposes of this Agreement, the Executive’s inability to perform the Executive’s duties hereunder by reason of physical or mental illness or injury for a period of 26 consecutive weeks
that follows the Executive’s use of all available sick leave (the “Disability Period”) shall constitute disability. The determination of disability shall be made by a physician selected by the Employers. During the Disability Period,
the Executive shall be entitled to 100% of the Executive’s Base Salary otherwise payable during that period. Upon a termination of employment due to the Executive’s disability, the Employers shall continue to pay the Executive’s Base
Salary in accordance with Section 2(a) for the remainder of the Employment Term and shall timely pay or provide any other Accrued Obligations and Other Benefits, which shall include disability benefits on the same basis as provided to similarly
situated executives of the Employers. 
  

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 (e) Termination for Cause. The Employers may terminate the Executive’s employment for Cause
by written notice to the Executive. For purposes of this Agreement, “Cause” shall mean: the willful engaging by the Executive in illegal conduct which is materially and demonstrably injurious to the Company, or the Executive’s
conviction of a felony or guilty or nolo contendere plea by the Executive with respect thereto. No act or omission shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable
belief that the Executive’s action or omission was in the best interests of the Employers. Notwithstanding any other term or provision of this Agreement to the contrary, if the Executive’s employment is terminated for Cause, the Executive
shall forfeit all rights to payments and benefits otherwise provided pursuant to this Agreement; provided, however, that the Accrued Obligations and Other Benefits through the date of termination shall be timely paid or provided. 
  
 (f) Termination Without Cause. The Employers may terminate the
Executive’s employment for reasons other than Cause upon not less than 60 days prior written notice delivered to the Executive, in which event the Employers shall pay to the Executive, within 30 days of the date of termination, a lump sum
payment equal to the unpaid Base Salary that would have been paid to or earned by the Executive pursuant to this Agreement, if the Executive had remained employed under the terms of this Agreement through the end of the Employment Term. In addition,
the Accrued Obligations and Other Benefits shall be timely paid or provided. If the Executive terminates his employment with the Employers during the Employment Term for “Good Reason,” such termination shall be deemed to have been a
termination by the Employers of the Executive’s employment without Cause. For purposes of this Agreement, “Good Reason” shall mean: (1) the assignment to the Executive by the Employers (or either of them) of duties materially
inconsistent with the Executive’s position, duties, responsibilities, and status with the Employers, a material adverse change in the Executive’s titles or offices, any removal of the Executive from or any failure to reelect the Executive
to any of such positions, except in connection with the termination of his employment for Cause, or any action that would have a material adverse effect on the physical conditions in which the Executive performs his employment duties; or (2) a
reduction by the Employers in the Executive’s Base Salary; or (3) the taking of any action by the Employers that would materially adversely affect the Executive’s participation in or materially reduce the Executive’s benefits under
any employee benefit plan or deprive the Executive of any material fringe benefit enjoyed by the Executive, except for a reduction in benefits that is being applied generally to all similarly situated employees; or (4) any other action or inaction
that constitutes a material breach by the Employers (or either of them) of this Agreement; or (6) any failure by the Employers to obtain the assumption of this Agreement by any acquirors, successors or assigns of the Employers. 
  
 (g) Resignation. Effective upon the Executive’s termination of
employment for any reason, the Executive hereby resigns from any and all offices and positions related to the Executive’s employment with the Employers and any subsidiaries or affiliates thereof, and held by the Executive at the time of
termination. 
  
 (h) No Mitigation. The Employers’
obligations to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Employer may have
against the Executive or others. In no event shall the Executive be obligated to seek 
  
  

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 other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement and, such amounts shall not be reduced whether or not the Executive obtains other employment. 
  
 (i) Litigation Expenses. The Employers shall pay the Executive’s out-of-pocket expenses, including attorney’s fees, in connection with
any judicial proceeding to enforce this Agreement or to construe or determine the validity of this Agreement or otherwise in connection herewith if the Executive is successful in litigation. The provisions of this Section 3(i) shall survive the
termination of this Agreement and/or the expiration of the Employment Term. 
  
 4. Covenants. 
  
 (a)
Confidentiality. The Executive shall not, without the prior written consent of the Employers, disclose or use in any way, either during the Employment Term or thereafter, except as required in the course of his employment by Employer, any
confidential business or technical information or trade secret or customer lists acquired in the course of the Executive’s employment by the Employers. The Executive acknowledges and agrees that it would be difficult to fully compensate the
Employers for damages resulting from the breach or threatened breach of the foregoing provision and, accordingly, that the Employers shall be entitled to temporary preliminary injunctions and permanent injunctions to enforce such provision. This
provision with respect to injunctive relief shall not, however, diminish the Employers’ right to claim and recover damages. The Executive covenants to use his best efforts to prevent the publication or disclosure of any trade secret or any
confidential information concerning the business or finances of Employers or Employers’ affiliates, or any of their dealings, transactions or affairs which may come to the Executive’s knowledge in the pursuance of his duties or employment.

  
 (b) No Competition. The Executive’s employment is
subject to the condition that (i) during the term of his employment hereunder and for a period of thirty-six (36) months following the date his employment ceases for any reason or no reason at all (including, but not limited to, a termination by the
Employers without Cause (described in Section 3(f) of this Agreement) (the “Date of Termination”), except as provided below, the Executive shall not, directly or indirectly, own, manage, operate, control or participate in the ownership,
management, operation or control of, or be connected as an officer, employee, partner, director, individual proprietor, lender, consultant, agent or otherwise with, or have any financial interest in, or aid or assist anyone else in the conduct of,
any entity or business (a “Competitive Operation”) which competes in the banking industry or with any other business conducted by either of the Employers or by any group, affiliate, division or subsidiary of either of the Employers, in any
area or market where such business is being conducted at the Date of Termination. It is understood and agreed that, for the purposes of the foregoing provisions of this paragraph, (i) no business shall be deemed to be a business conducted by an
Employer or any group, division, affiliate or subsidiary of an Employer unless 5% or more of such Employer’s consolidated gross sales or operating revenues is derived from, or 5% or more of such Employer’s consolidated assets are devoted
to, such business; (ii) no business conducted by any entity by which the Executive is employed or in which he is interested or with which he is connected or associated shall be deemed competitive with any business conducted by an 
  

 4 

 Employer or any group, division or subsidiary of such Employer unless it is one from which 5% or more of its consolidated
gross sales or operating revenues is derived, or to which 5% or more of its consolidated assets are devoted; and (iii) no business which is conducted by the Employers at the Date of Termination and which subsequently is sold by either Employer or
its affiliates shall, after such sale, be deemed to be a Competitive Operation within the meaning of this paragraph. Ownership of not more than 1% of the voting stock of any entity shall not constitute a violation of this paragraph. 
  
 (c) Modification. Although the parties consider the restrictions
contained in this Section 4 reasonable as to the protected business, duration, and geographic area, in the event that any court of competent jurisdiction deems them to be unreasonable, then such restrictions shall apply to the broadest business,
longest period, and largest geographic territory as may be considered reasonable by such court, and this Section 4, as so amended, shall be enforced. 
  
 (d) Other Agreements. The Executive represents and warrants that neither the Executive’s employment with the Employers nor the
Executive’s performance of his obligations hereunder will conflict with or violate the Executive’s obligations under the terms of any agreement with a previous employer or other party including agreements to refrain from competing,
directly or indirectly, with the business of such previous employer or any other party. 
  
 5. Withholding. 
  
 The
Employers shall deduct and withhold from compensation and benefits provided under this Agreement all necessary income and employment taxes and any other similar sums required by law to be withheld. 
  
 6. Rules, Regulations and Policies. 
  
 The Executive shall use his best efforts to abide by and comply with all of
the rules, regulations, and policies of the Employers, including without limitation the Employers’ policy of strict adherence to, and compliance with, any and all requirements of the banking, securities, and antitrust laws and regulations.

  
 7. Return of Employer’s Property. 
  
 After the Executive has received notice of termination or at the end of his
period of employment with Employer, whichever first occurs, the Executive shall immediately return to Employer all documents and other property in his possession belonging to Employer. 
  
 8. Construction and Severability. 
  
 The invalidity of any one or more provisions of this Agreement or any part thereof, all of which are inserted conditionally
upon their being valid in law, shall not affect the validity of any other provisions to this Agreement; and in the event that one or more provisions contained herein shall be invalid, as determined by a court of competent jurisdiction, this
Agreement shall be construed as if such invalid provisions had not been inserted. The Executive’s or the Employers’ failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the
Executive or the Employers may have hereunder, including, without 
  

 5 

 limitation, the right of the Executive to terminate employment for Good Reason, shall not be deemed to be a waiver of
such provision or right or any other provision or right of this Agreement. 
  
 9. Governing Law. 
  
 This
Agreement shall be governed by the laws of the United States, where applicable, and otherwise by the laws of the State of New York other than the choice of law rules thereof. 
  
 10. Assignability and Successors. 
  
 This Agreement may not be assigned by the Executive or the Employers, except that this Agreement shall be binding upon and
shall inure to the benefit of the successor of Employers through merger or corporate reorganization. 
  
 11. Counterparts. 
  
 This Agreement may be executed in counterparts (each of which need not be executed by each of the parties), which together shall constitute one and the
same instrument. 
  
 12. Jurisdiction and Venue.

  
 The jurisdiction of any proceeding between the parties
arising out of, or with respect to, this Agreement shall be in a court of competent jurisdiction in New York State, and venue shall be in Oneida County. Each party shall be subject to the personal jurisdiction of the courts of New York State.

  
 13. Indemnification and Insurance. 
  
 During the Employment Term and for a period of six years thereafter, the
Employers shall cause the Executive to be covered by and named as an insured under any policy or contract of insurance obtained by either of them to insure directors and officers against personal liability for acts or omissions in connection with
service as a director or officer of Partner Trust or the Bank or any subsidiary or affiliate thereof or service in other capacities at the request of either of the Employers. The coverage provided to the Executive pursuant to this section shall be
of the same scope and on the same terms and conditions as the coverage (if any) provided to other officers or directors of either of the Employers. 
  
 To the maximum extent permitted under applicable law, during the Employment Term and for a period of six years thereafter, the Employers shall indemnify
the Executive against and hold him harmless from any costs, liabilities, losses and exposures to the fullest extent and on the most favorable terms and conditions that similar indemnification is offered to any trustee or officer of the Bank or any
subsidiary or affiliate thereof. Indemnification and Insurance coverage will not be provided by employer in the event of employee’s voluntary termination (Section 3(b) of this Agreement) or for termination for Cause (Section 3(e) of this
Agreement). Nothing contained herein shall limit or an any way impair the obligations to indemnify and maintain directors and officers’ liability insurance as set forth in the Merger Agreement. 
  

 6 

 14. Miscellaneous. 
  
 This Agreement constitutes the entire understanding and Agreement between the parties with respect to the subject matter
hereof and shall supersede all prior understandings and agreements, other than the Employment Agreement between the Executive, BSB Bancorp, Inc. and BSB Bank and Trust Company, dated as of October 22, 2001, and the Target Benefit Supplemental
Retirement Benefit Agreement between BSB Bank & Trust Company and the Executive, dated as of October 30, 2003. 
  
 This Agreement cannot be amended, modified, or supplemented in any respect, except by a subsequent written agreement entered into by the parties hereto.

  
  

 7 

 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement, or caused this Agreement to be
duly executed on their behalf, as of the date and year first above written. 
  

							
	 Attest:
	 	 	 	 SBU BANK

				
	 /s/    Steven A. Covert

	 	 	 	 By
	 	 /s/    John A. Zawadzki

	 	 	 	 	 	 	 PRESIDENT & CEO

			
	 Attest:
	 	 	 	 PARTNER TRUST FINANCIAL GROUP, INC.

				
	 /s/    Steven A. Covert

	 	 	 	 By
	 	 /s/     John A. Zawadzki

	 	 	 	 	 	 	 PRESIDENT & CEO

				
	 	 	 	 	 	 	 /s/    Howard W. Sharp

	 	 	 	 	 Howard W. Sharp

	 	 	 	 	 Executive

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