Executive Mandatory Retirement Benefit Plan

SECTION I


PURPOSE


1.1 Purpose. The purpose of the Harris & Harris Group, Inc. Executive Mandatory Retirement Benefit Plan (the "Plan") is to provide those employees of Harris & Harris Group, Inc. who are required to retire pursuant to the Harris & Harris Group, Inc. Executive Mandatory Retirement Program with a nonforfeitable retirement benefit which will satisfy the requirements for exempting those employees from any prohibitions against mandatory retirement which might otherwise apply under any age discrimination laws applicable to such terminations of employment.


SECTION II


DEFINITIONS


2.1 Definitions. The following definitions shall apply for purposes of the Plan, unless a different meaning is plainly indicated by the context:


(a) Age Discrimination Acts shall mean, collectively, the federal Age Discrimination in Employment Act, 29 U.S.C. Section 621 et seq., the New York State Human Rights Law, N.Y. Exec. Law Section 290 et seq., the New York City Human Rights Law, Section 8-107 and any other applicable law pertaining to age discrimination, as well as any regulations promulgated under any such law.


(b) Board shall mean the Board of Directors of the Company, as constituted from time to time.


(c) Code shall mean the Internal Revenue Code of 1986, as amended from time to time.


(d) Committee shall mean a committee to administer the Program which shall be comprised of all members of the Company's Board of Directors serving from time to time who would be treated as "non-interested directors" for purposes of determining eligibility for service on the Board's Audit Committee.


(e) Company shall mean Harris & Harris Group, Inc., and any successor to all or a major portion of its assets or business, which successor assumes the obligations of the Company under this Plan by operation of law or otherwise.


(f) Effective Mandatory Retirement Date shall be the date on which an employee's employment is actually terminated in a mandatory retirement pursuant to the Program (whether such date is the Initial Mandatory Retirement Date or a later date).


(g) ERISA shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time.


(h) Initial Mandatory Retirement Date, for an employee of the Company who has been designated as subject to the Program, shall be December 31 of the year in which the employee attains the age of 65 years (or December 31 of such later year as the two-year "bona fide executive or high policymaking position" employment requirement of the Program is first met by the employee); provided, however, that the employee's mandatory retirement can be postponed in accordance with the Program.


(i) Mandatory Retirement Benefit Amount shall mean the lump sum equivalent of a nonforfeitable retirement benefit (within the meaning of, and calculated in accordance with, the Age Discrimination Acts) which will satisfy the requirements for exempting the Participant from any prohibitions against compulsory retirement under the Age Discrimination Acts immediately prior to the Participant's Effective Mandatory Retirement Date. As of the adoption of this Plan, the Mandatory Retirement Benefit Amount is the lump sum equivalent of an immediate nonforfeitable straight life annuity (with no ancillary benefits) of $44,000.


(j) Offsetting Benefit Amount shall mean the aggregate lump sum equivalent of those benefits to which a Participant is entitled outside of the Plan which are treated as immediate non ...