Document:

Exhibit
10.3

 

CHANGE
IN CONTROL AGREEMENT

 

CHANGE
IN CONTROL AGREEMENT (this “Agreement”) made as of this ____ day of _________, 2020 by and between HANOVER COMMUNITY
BANK, a New York state commercial bank with its principal place of business located at 80 East Jericho Turnpike, Mineola,
N.Y. 11501, (the "Employer"), and ______________, an individual residing at ______________________________
("Employee").

 

W I
T N E S S E T H:

WHEREAS,
Employer wishes to retain Employee;

 

WHEREAS,
it is a condition to Employee’s retention that Employer enter into this Agreement with Employee;

 

NOW,
THEREFORE, in consideration of the mutual promises and undertakings herein contained, the parties hereto, intending to be
legally bound, agree as follows:

 

1.      Change
in Control.

 

(a)           
Upon the occurrence of a Change in Control (as herein defined), Employee shall be entitled to receive the payments provided for
under paragraph (c) hereof.

 

(b)            A
 "Change in Control" shall mean:

 

		(i)	a
                                         reorganization, merger, consolidation or sale of all or substantially all of the assets
                                         of the Company, or a similar transaction, in any case in which the holders of the voting
                                         stock of the Company prior to such transaction do not hold a majority of the voting power
                                         of the resulting entity; or

 

		(ii)	individuals
                                         who constitute the Incumbent Board (as herein defined) of the Company cease for any reason
                                         to constitute a majority thereof.

 

For
these purposes, “Company” shall mean Hanover Bancorp, Inc., the parent corporation of the Employer, and "Incumbent
Board" means the Board of Directors of the Company as of the date hereof, provided that any person becoming a director subsequent
to the date hereof whose election was approved by a voting of at least three-quarters of the directors comprising the Incumbent
Board, or whose nomination for election by members or stockholders was approved by the same nominating committee serving under
an Incumbent Board, shall be considered as though he were a member of the Incumbent Board.

 

     

     

    

 

(c)       In
the event the conditions of Section (a) above are satisfied, Employee shall be entitled to receive a lump sum payment equal to
one (1) times the sum of (i) his then current annual Base Salary, (ii) the highest cash bonus payment paid to Employee over the
past three years, and (iii) the annual total automobile allowance paid to Employee, if any; provided, however, that in the event
any payments provided for hereunder, when combined with any other payments due to Employee under any other agreement or benefit
plan of Employer contingent upon a Change in Control, constitute an "excess parachute payment" under Section 280G of
the Internal Revenue Code of 1986, as amended or any successor thereto, then in order to avoid such a result the benefits provided
for hereunder (or, at the option of Employee, any other agreement, plan or program providing for payments contingent upon a Change
in Control) will be reduced, if necessary, to an amount which is One Dollar ($1.00) less than an amount equal to three (3) times
Employee's "base amount" as determined in accordance with such Section 280G. In addition to the foregoing, Employee
shall be entitled to receive from Employer, or its successor, hospital, health, medical and life insurance on the terms and at
the cost to Employee as Employee was receiving such benefits upon the date of his termination. Employer's obligation to continue
such insurance benefits will be for a period of two (2) years from the effective date of the Change in Control.

 

(d)       All
payments and benefits under paragraph (c) above shall be contingent upon Employee executing a general release of claims in favor
of the Employer, its subsidiaries and affiliates, and their respective officers, directors, shareholders, partners, members, managers,
agents or employees, which release shall be provided to the Employee within five (5) business days following the termination
date, and which must be executed by the Employee and become effective within thirty (30) days thereafter. Severance payments under
paragraph (c) that are contingent upon such release shall, subject to Section 14, commence within ten (10) days after such release
becomes effective; provided, however, that if Employee’s termination date occurs on or after November 15 of a calendar year,
then severance payments shall, subject to the effectiveness of such release and Section 14, commence on the first business day
of the following calendar year.

 

2.      No
Guaranty of Employment. Nothing in this Agreement shall be construed as guarantying the employment of the Employee. Employee
shall remain an “employee at will” of Employer at all time during the term of this Agreement.

 

     

     

    

 

3.      Notices.
Any and all notices, demands or requests required or permitted to be given under this Agreement shall be given in writing and
sent, (i) by registered or certified U.S. mail, return receipt requested, (ii) by hand, (iii) by overnight courier or (iv) by
telecopier addressed to the parties hereto at their addresses set forth above or such other addresses as they may from time-to-time
designate by written notice, given in accordance with the terms of this Section, together with copies thereof as follows:

 

In
the case of Employee, to the address set forth on the first page hereof or to such other address as Employee shall provide in
writing to the Employer for the provision of notices hereunder.

 

In
the case of Employer, to the address set forth on the first page hereof with a copy to:

 

Windels Marx
Lane & Mittendorf, LLP

120 Albany
Street Plaza, 6th Floor

New Brunswick,
New Jersey 08901

Telecopier
No. (732) 846-8877

Attention:
Robert A. Schwartz

 

Notice
given as provided in this Section shall be deemed effective: (i) on the date hand delivered, (ii) on the first business day following
the sending thereof by overnight courier, (iii) on the seventh calendar day (or, if it is not a business day, then the next succeeding
business day thereafter) after the depositing thereof into the exclusive custody of the U.S. Postal Service or (iv) on the date
telecopied.

 

4.      Term.
Unless extended by mutual agreement, this Agreement shall have a term of three (3) years from the date hereof; provided, however,
that in the event the term of this Agreement would terminate at any time after the Employer has engaged in substantive negotiations
regarding a transaction which would lead to a Change in Control, this Agreement shall continue to remain in full force in effect
until the earlier to occur of (i) the effectuation of the Change in Control or (ii) the termination of the negotiations for the
proposed transaction which would have resulted in the Change in Control; further provided, however, that unless either party shall
give written notice of its intention not to renew this Agreement at least one hundred and eighty (180) days prior to the end of
the term of this Agreement (as it may be extended), this Agreement shall renew for an additional one (1) year term upon the conclusion
of each term.

 

     

     

    

 

5.      Non-Solicitation. During the period Employee is performing services for the Employer and for a period of one (1) year following
the termination of the Employee's services for the Employer for any reason, the Employee agrees that the Employee will not, directly
or indirectly, for the Employee's benefit or for the benefit of any other person, firm or entity, do any of the following:

 

		(a)	solicit
                                         or attempt to solicit from (i) any customer that Employee serviced or learned of while
                                         in the employ of the Employer ("Customer"), (ii) referral
                                         sources or prospective referral sources which are actively being sought by Employer at
                                         the time of Employee’s termination (a “Referral Source”), or
                                         (iii) any potential customer of the Employer which has been the subject of a known written
                                         or oral bid, offer or proposal by the Employer, or of substantial preparation with a
                                         view to making such a bid, proposal or offer, within twelve months prior to such Employee's
                                         termination ("Potential Customer"), business of a similar nature or related
                                         to the business of the Employer;
	 	 	 

		(b)	accept
                                         any business from, or perform any work or services for, any Customer, Referral Source
                                         or Potential Customer, which business, work or services is similar to the business of
                                         the Employer;
	 	 	 

		(c)	cause
                                         or induce or attempt to cause or induce any Customer, Referral Source, Potential Customer,
                                         licensor, supplier or vendor of the Employer to reduce or sever its affiliation with
                                         the Employer;
	 	 	 

		(d)	solicit
                                         the employment or services of, or hire or engage, or assist anyone else to hire or engage,
                                         any person who was known to be employed or engaged by or was a known employee of or consultant
                                         to the Employer upon the termination of the Employee's services to the Employer, or within
                                         twelve months prior thereto; or

 

     

     

    

 

		(e)	otherwise
                                         interfere with the business or accounts of the Employer.

 

For purposes
hereof, "solicitation" shall include directly or indirectly initiating any contact or communication of any kind whatsoever
for purposes of inviting, encouraging or requesting such Customer, Referral Source, Potential Customer, licensor, supplier, vendor,
employee or consultant to materially alter its business relationship, or engage in business, with the Employee or any person,
firm or entity other than the Employer.

 

6.       Confidential
Information

 

(a)       As
used herein, "Confidential Information" means any confidential or proprietary information relating to the Employer and
its affiliates including, without limitation, the identity of the Employer's customers, the identity of representatives of customers
with whom the Employer has dealt, the kinds of services provided by the Employer to customers, the manner in which such services
are performed or offered to be performed, the service needs of actual or prospective customers, customer preferences and policies,
pricing information, business and marketing plans, financial information, budgets, compensation or personnel records, information
concerning the creation, acquisition or disposition of products and services, vendors, software, data processing programs, databases,
customer maintenance listings, computer software applications, research and development data, know-how, and other trade secrets.

 

Notwithstanding
the above, Confidential Information does not include information which: (i) is or becomes public knowledge without breach of this
Agreement; or (ii) is received by Employee from a third party without any violation of any obligation of confidentiality and without
confidentiality restrictions; provided, however, that nothing in this Agreement shall prevent the Employee from participating
in or disclosing documents or information in connection with any judicial or administrative investigation, inquiry or proceeding
to the extent that such participation or disclosure is required under applicable law; provided further, however, that the Employee
will provide the Employer with prompt notice of such request so that the Employer may seek (with the cooperation of the Employee,
if so requested by the Employer), a protective order or other appropriate remedy and/or waiver in writing of compliance with the
provisions of this Agreement. If a particular portion or aspect of Confidential Information becomes subject to any of the foregoing
exceptions, all other portions or aspects of such information shall remain subject to all of the provisions of this Agreement.

 

     

     

    

 

(b)       At
all times, both during the period of Employee's services for the Employer and after termination of Employee's services, the Employee
will keep in strictest confidence and trust all Confidential Information and the Employee will not directly or indirectly use
or disclose to any third-party any Confidential Information, except as may be necessary in the ordinary course of performing the
Employees duties for the Employer, or disclose any Confidential Information, or permit or encourage any other person or entity
to do so, without the prior written consent of the Employer except as may be necessary in the ordinary course of performing the
Employee's duties for the Employer.

 

(c)       The
Employee agrees to return promptly all Confidential Information in tangible form, including, without limitation, all photocopies,
extracts and summaries thereof, and any such information stored electronically on tapes, computer disks, mobile or remote computers
(including personal digital assistants) or in any other manner to the Employer at any time that the Employer makes such a request
and automatically, without request, within five days after the termination of the Employee's performance of services for the Employer
for any reason.

 

7.      Assignability.
The services of the Employee hereunder are personal in nature, and neither this Agreement nor the rights or obligations of Employee
hereunder may be assigned, whether by operation of law or otherwise. This Agreement shall be binding upon, and inure to the benefit
of, Employer and its successors and assigns. This Agreement shall inure to the benefit of the Employee's heirs, executors, administrators
and other legal representatives.

 

     

     

    

 

8.      Waiver.
The waiver by Employer or the Employee of a breach of any provision of this Agreement by the other shall not operate or be construed
as a waiver of any subsequent or other breach hereof.

 

9.      Applicable
Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York without giving
effect to principles of conflict of laws.

 

10.    Entire
Agreement. This Agreement contains the entire agreement of the parties hereto with respect to the subject matter hereof and
may not be amended, waived, changed, modified or discharged, except by an agreement in writing signed by the parties hereto.

 

11.    Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which taken together
shall constitute one and the same instrument.

 

12.    Amendment.
This Agreement may be modified or amended only by an amendment in writing signed by both parties.

 

13.    Severability. If any provision of this Agreement shall be held invalid or unenforceable, such invalidity or unenforceability
shall attach only to such provision, only to the extent it is invalid or unenforceable, and shall not in any manner affect or
render invalid or unenforceable any other severable provision of this Agreement, and this Agreement shall be carried out as if
any such invalid or unenforceable provision were not contained herein.

 

14.    Section
Headings. The headings contained in this Agreement are solely for convenience of reference and shall be given no effect in
the construction or interpretation of this Agreement.

 

     

     

    

 

15.    Section
409A. This Agreement shall be interpreted to avoid any penalty sanctions under Section 409A of the Code (“Section 409A”)
and regulations promulgated thereunder. Notwithstanding anything contained herein to the contrary, the Employee shall not be considered
to have terminated employment with the Employer for purposes of the payments and benefit of Section 1 hereof unless he would be
considered to have incurred a “termination of employment” from the Employer within the meaning of Treasury Regulation
 §1.409A-1(h)(1)(ii). For purposes of Section 409A, each payment made under this Agreement shall be treated as a separate
payment. In no event may the Employee, directly or indirectly, designate the calendar year of payment. Notwithstanding the foregoing,
if necessary to comply with the restriction in Section 409A(a)(2)(B) of the Code concerning payments to “specified employees”,
any payment as a result of the termination of the Employee’s employment that would otherwise be due hereunder within six
months after such termination of employment shall nonetheless be delayed until the first business day of the seventh month following
the Employee’s date of termination and the first such payment shall include the cumulative amount of any payments that would
have been paid prior to such date if not for such restriction.

 

16.    Arbitration.
Any dispute or controversy arising under this Agreement shall be settled exclusively by binding arbitration, as an alternative
to civil litigation and without any trial by jury to resolve such claims, conducted by a single arbitrator, mutually acceptable
to the Employer and the Employee, sitting in New York County, New York, unless otherwise mutually agreed by the Employer and the
Employee, in accordance with the rules of the American Arbitration Association’s National Rules for the Resolution of Employment
Disputes then in effect. Judgment may be entered on the arbitrator’s award in any court having jurisdiction. Notwithstanding
the forgoing, the parties to this Agreement may seek equitable relief in any court or competent jurisdiction for a matter in the
nature of, but not limited to, restraining orders or injunctions.

 

17.    Clawback.
With regard to any payment made hereunder, Employer or its successors retains the legal right to demand the return of any
payment made should Employer or its successors later obtain information indicating that the Employee has committed, is substantially
responsible for, or has violated, the respective acts or omissions, conditions, or offenses outlined under the FDIC's regulations
at 12 C.F.R. 359.4(a)(4).

 

     

     

    

 

IN WITNESS
WHEREOF, the parties hereto have executed this Agreement under their respective hands and seals as of the day and year first
above written.

 

 

	ATTEST:	 	HANOVER COMMUNITY BANK
	 	 	 
	 	 	By:	 
	 	 	 	Michael P.
Puorro
	 	 	 	Chairman & CEO
	 	 	 	 
	WITNESS:	 	EMPLOYEE:
	 	 	 
	 	 	Name:
	 	 	Title:Exhibit 10.4

 

HANOVER COMMUNITY BANK

 

2013 STOCK OPTION PLAN

 

Section 1. Purpose

 

The Hanover Community Bank 2013 Stock Option
Plan (the "Plan") is hereby established to foster and promote the long-term success of Hanover Community Bank (the "Bank")
and its shareholders by providing members of management, including employees and management officials, with an equity interest
in the Bank. The Plan will assist the Bank in attracting and retaining the highest quality of experienced persons to serve as Directors
and in aligning the interests of such persons more closely with the interests of the Bank's shareholders by encouraging such parties
to maintain an equity interest in the Bank.

 

Section 2. Definitions

 

Capitalized terms not specifically defined
elsewhere herein shall have the following meaning:

 

"Act" means the Securities Exchange
Act of 1934, as amended from time to time, and any rules and regulations promulgated thereunder.

 

"Bank" means Hanover Community Bank
and any present or future subsidiary or parent corporations of Hanover Community Bank (as defined in Section 424 of the Code) or
any successor to such corporations.

 

"Board" means the Board of Directors
of the Bank.

 

"Code" means the Internal Revenue
Code of 1986, as amended from time to time, and the regulations promulgated thereunder.

 

"Committee" shall mean the committee
provided for under Section 3(a) hereof.

 

"Common Stock" or "Stock"
means the common stock, $0.01 per share par value, of the Bank.

 

"Disability" shall mean, with respect
to a Management Official who is an employee, a permanent disability which qualifies as total disability under the terms of the
Bank's Long-Term Disability Plans and, with respect to a Management Official who is a non-employee member of the Board, permanent
and total disability which if the Management Official were an employee of the Bank would be treated as a total disability under
the terms of the Bank's long-term disability plan for employees as in effect from time to time; provided, however, with respect
to a Participant who has been granted an Incentive Stock Option such term shall have the meaning set forth in Section 422(c)(6)
of the Code.

 

"Fair Market Value" means, with
respect to shares of Common Stock, (i) for so long as the Common Stock is traded on a national exchange or established inter-dealer
market, the fair market value shall be equal to the closing, or if there is no such sales price, the average of the last reported
bid and asked prices, as reported by such inter-dealer market for the day prior to the date of grant, and (ii) if the stock is
not so listed or traded, the fair market value as determined by the Board in good faith and in a manner established by the Board
from time to time, taking into account such factors as the Board shall deem relevant, including the book value of the Common Stock,
the market value of the shares of comparable banks, and the trend of the Bank's earnings in accordance with Section 26.11 of the
General Regulations of the Superintendent.

 

"Incentive Stock Option" means an
option to purchase shares of Common Stock granted to a Participant under the Plan which is intended to meet the requirements of
Section 422 of the Code.

 

"Management Official" means an employee
of the Bank, a non-employee member of the Board, a member of any advisory Board or any other service provider to the Bank.

 

     

     

    

 

"Non-Qualified Stock Option" means
an option to purchase shares of Common Stock granted to a Participant under the Plan which is not intended to be an Incentive Stock
Option.

 

"Option" means an Incentive Stock
Option or a Non-Qualified Stock Option granted hereunder.

 

"Participant" means a Management
Official selected by the Board to receive an Option under the Plan.

 

"Plan" means the Hanover Community
Bank 2013 Stock Option Plan.

 

"Superintendent" means the Superintendent
of Financial Services of the State of New York.

 

"Termination for Cause" means termination
because of Participant's intentional failure to perform stated duties, personal dishonesty, willful violation of any law, rule
regulation (other than traffic violations or similar offenses) or final cease and desist order issued by any regulatory agency
having jurisdiction over the Participant or the Bank.

 

Section 3. Administration

 

(a)        The
Plan shall be administered as follows: the Bank’s Board of Directors shall appoint a committee made up entirely of non-employee
directors (the “Committee”). No then current member of the Committee shall be under consideration for a grant under
this Plan at the time the Committee acts on such a grant. Among other things, the Committee shall, subject to the terms of the
Plan, make recommendations to the Board of Directors with regard to granting Options, determining the individuals to whom and the
time or times at which Options may be granted, determining whether such Options are to be Incentive Options or Non-Qualified Stock
Options (subject to the requirements of the Code, which provide that only employees may receive Incentive Options), determining
the terms and conditions of any Option granted hereunder, including whether to impose any vesting period, and the exercise price
thereof, subject to the requirements of this Plan. All such Committee recommendations shall then be presented to the Board of Directors
for review and approval; provided, however, that the Board may not determine to make a grant of options unless recommended by the
Committee. 

 

(b)       Subject
to the other provisions of the Plan, to the Superintendent's approval and to final approval of the Board of Directors, the Committee
shall have authority to adopt, amend, alter and repeal such administrative rules, guidelines and practices governing the operation
of the Plan as it shall from time to time consider advisable to interpret the provisions of the Plan and any Option and to decide
all disputes arising in connection with the Plan. The Board may correct any defect or supply any omission or reconcile any inconsistency
in the Plan or in any option agreement in the manner and to the extent it shall deem appropriate to carry the Plan into effect,
in its sole and absolute discretion. The Board's decision and interpretations shall be final and binding. Notwithstanding the foregoing,
the approval of the holders of a majority of the Bank's outstanding capital stock shall be required for any amendment (other than
an adjustment made pursuant to Section 5(b) hereof) which would: (i) increase the number of shares as to which options may be granted;
(ii) change the number of shares which may be optioned to any single individual; (iii) decrease an option price; (iv) extend the
term of the plan or of an option; or (v) change the persons or category of persons eligible to be granted options.

 

(c)       The
Committee may employ such legal counsel, consultants and agents as it may deem desirable for the administration of the Plan and
may rely upon any opinion received from any such counsel or consultant and any computation received from any such consultant or
agent.

 

     

     

    

 

Section 4. Eligibility and Participation

 

Management Officials of the Bank shall be
eligible to participate in the Plan. The Participants under the Plan shall be selected from time to time from among those eligible,
and the Board, on the basis of the recommendation of the Committee shall determine in its sole discretion the numbers of shares
to be covered by the Option or Options granted to each Participant. Options intended to qualify as Incentive Stock Options shall
be granted only to persons who are eligible to receive such options under Section 422 of the Code; i.e., employees of the Bank.

 

Section 5. Shares of Stock Available for Options

 

(a)       The
maximum number of shares of Common Stock which may be issued and purchased pursuant to Options granted under the Plan is 1,297,929
subject to the adjustments as provided in Section 5 and Section 9, to the extent applicable. If an Option granted under this Plan
expires or terminates before exercise or is forfeited for any reason, without a payment in the form of Common Stock being granted
to the Participant, the shares of Common Stock subject to such Option, to the extent of such expiration, termination or forfeiture,
shall again be available for subsequent Option grant under Plan.

 

(b)       In
the event that any stock dividend, stock split, reverse stock split or combination, or other similar transaction affects the Common
Stock such that an adjustment is required in order to preserve the benefits or potential benefits intended to be granted or made
available under the Plan to Participants, the Board shall, subject to the Superintendent’s approval, proportionately and
appropriately adjust equitably any or all of (i) the maximum number and kind of shares of Common Stock in respect of which Options
may be granted under the Plan to Participants, (ii) the number and kind of shares of Common Stock subject to outstanding Options
held by Participants, and (iii) the exercise price with respect to any Options held by Participants, without changing the aggregate
purchase price as to which such Options remain exercisable, and if considered appropriate, the Board, may make provision for a
cash payment with respect to any outstanding Options held by a Participant, provided that no adjustment shall be made pursuant
to this Section if such adjustment would cause the Plan to fail to comply with Section 422 of the Code with regard to any Incentive
Stock Options granted hereunder or fail to comply with the requirements of Rule 16b-3 under the Act or any successor or replacement
regulation. No fractional Shares shall be issued on account of any such adjustment.

 

(c)       Any
adjustments under this Section will be made by the Committee whose determination as to what adjustments, will be made and the extent
thereof will be (subject only to the Superintendent’s approval) final, binding and conclusive.

 

Section 6. Non-Qualified Stock Options

 

6.1       Grant
of Non-Qualified Stock Options.

 

Subject to the provisions hereof, the Board
may, from time to time, grant Non-Qualified Stock Options to Participants upon such terms and conditions as the Committee may determine,
and may grant Non-Qualified Stock Options in exchange for and upon surrender of previously granted Options under this Plan. Non-Qualified
Stock Options granted under this Plan are subject to the following terms and conditions:

 

(a)       Price.
The purchase price per share of Common Stock deliverable upon the exercise of each Non-Qualified Stock Option shall be determined
by the Board on the date the option is granted. The purchase price shall not be less than one hundred percent (100%) of the Fair
Market Value of the Common Stock on the date of grant or the par value of the Common Stock, whichever is greater. Shares may be
purchased only upon full payment of the purchase price.

 

(b)       Terms
of Options. The term during which each Non-Qualified Stock Option may be exercised shall be determined by the Board, but in
no event shall a Non-Qualified Stock Option be exercisable in whole or in part more than ten (10) years from the date of grant.

 

     

     

    

 

(c)       Termination
of Service. Except as provided herein, unless otherwise determined by the Board, upon the termination of the service of a Participant
for any reason other than death or Termination for Cause, the Participant's Non-Qualified Stock Options shall be exercisable only
as to those shares which were immediately exercisable by the Participant at the date of termination and only for one (1) year from
the date of such termination. In the event of death of any such Participant, all Non-Qualified Stock Options held by such Participant,
whether or not exercisable at such time, shall be exercisable by the Participant or his legal representatives or beneficiaries
of the Participant for one year or such longer period as is determined by the Board following the date of the Participant's death,
provided and in no event shall the period extend beyond the expiration of the Non-Qualified Stock Option term. Notwithstanding
any other provisions set forth herein to the contrary nor any provision contained in any agreement relating to the award of an
option, in the event of a Termination for Cause, all of the Participant's Non-Qualified Stock Options shall immediately expire
upon such Termination for Cause and shall not be exercisable, regardless of whether such Non-Qualified Stock Options were vested.

 

(d)       Transferability. Except as provided
for hereunder, no Option granted under the Plan shall be assignable or transferable by a Participant, and any attempted disposition
thereof shall be null and void and of no effect. Non-qualified Options granted hereunder may only be transferred by will or by
the applicable laws of descent and distribution.

 

Section 7. Incentive Stock Options

 

7.1       Grant
of Incentive Stock Options.

 

The Board may, from time to time, grant Incentive
Stock Options to Management Officials who are employees of the Bank. Incentive Stock Options granted pursuant to the Plan shall
be subject to the following terms and conditions:

 

(a)       Price.
The purchase price per share of Common Stock deliverable upon the exercise of each Incentive Stock Option shall be not less than
one hundred percent (100%) of the Fair Market Value of the Common Stock on the date of grant or the par value of the Common Stock,
whichever is higher. However, if a Participant owns stock possessing more than ten percent (10%) of the total combined voting power
of all classes of Common Stock, the purchase price per share of Common Stock deliverable upon the exercise of each Incentive Stock
Option shall not be less than one hundred ten percent (110%) of the Fair Market Value of the Common Stock on the date of grant
or the par value of the Common Stock, whichever is greater. Shares may be purchased only upon payment of the full purchase price.

 

(b)       Amounts
of Options. Incentive Stock Options may be granted to any Management Official who is an employee of the Bank in such amounts
as determined by the Board. In the case of an option intended to qualify as an Incentive Stock Option, the aggregate Fair Market
Value (determined as of the time the option first becomes exercisable) of the Common Stock with respect to which Incentive Stock
Options granted are exercisable for the first time by the Participant during any calendar year shall not exceed $100,000. The provisions
of this Section 7.1(b) shall be construed and applied in accordance with Section 422(d) of the Code and the regulations, if any,
promulgated thereunder. To the extent an award is in excess of such limit, it shall be deemed a Non-Qualified Stock Option. The
Board shall have discretion to redesignate options granted as Incentive Stock Options as Non-Qualified Options.

 

(c)       Terms
of Options. The term during which each Incentive Stock Option may be exercised shall be determined by the Board, but in no
event shall an Incentive Stock Option be exercisable in whole or in part more than ten (10) years from the date of grant. If at
the time an Incentive Stock Option is granted to an employee, the employee owns Common Stock representing more than ten percent
(10%) of the total combined voting power of the Bank (or, under Section 422(d) of the Code, is deemed to own Common Stock representing
more than ten percent (10%) of the total combined voting power of all such classes of Common Stock, by reason of the ownership
of such classes of Common Stock, directly or indirectly, by or for any brother, sister, spouse, ancestor or lineal descendent of
such employee, or by or for any corporation, partnership, estate or trust of which such employee is a shareholder, partner or beneficiary),
the Incentive Stock Option granted to such employee shall not be exercisable after the expiration of five years from the date of
grant.

 

(d)       Termination
of Service. Upon the termination of a Participant's service for any reason other than Disability, death or Termination for
Cause, the Participant's Incentive Stock Options which are then exercisable at the date of termination may only be exercised by
the Participant for a period of three months following termination. Notwithstanding any provisions set forth herein nor contained
in any Agreement relating to an award of an Option, in the event of Termination for Cause all rights under the Participant's Incentive
Stock Options shall expire immediately upon termination, and such Incentive Stock Options shall not be exercisable.

 

     

     

    

 

Unless otherwise determined by the Board,
in the event of death or termination of service as a result of Disability of any Participant, all Incentive Stock Options held
by such Participant, whether or not exercisable at such time, shall be exercisable by the Participant or the Participant's legal
representatives or beneficiaries of the Participant for one year following the date of the participant's death or termination of
employment as a result of Disability. In no event shall the exercise period extend beyond the expiration of the Incentive Stock
Option term.

 

(e)       Transferability.
No Incentive Option granted under the Plan shall be assignable or transferable by a Participant, except pursuant to the laws of
descent and distribution, and any attempted distribution shall be null and void and of no effect.

 

(f)        Compliance
with Code. The options granted under this Section 7 of the Plan are intended to qualify as incentive stock options within the
meaning of Section 422 of the Code, but the Bank makes no warranty as to the qualification of any option as an incentive stock
option within the meaning of Section 422 of the Code. A Participant shall notify the Board in writing in the event that he disposes
of Common Stock acquired upon exercise of an Incentive Stock Option within the two-year period following the date the Incentive
Stock Option was granted or within the one-year period following the date he received Common Stock upon the exercise of an Incentive
Stock Option and shall comply with any other requirements imposed by the Bank in order to enable the Bank to secure the related
income tax deduction to which it will be entitled in such event under the Code.

 

Section 8. General Provisions Applicable to Options 

 

(a)       Pursuant
to Section 26.12(h) of the General Regulations of the Superintendent, each Option under the Plan shall be evidenced by a writing
delivered to the Participant specifying the terms and conditions thereof and containing such other terms and conditions not inconsistent
with the provisions of the Plan as the Board considers necessary or advisable to achieve the purposes of the Plan or comply with
applicable tax and regulatory laws and accounting principles, and incorporating the terms of this Plan.

 

(b)       Each
Option may be granted alone, in addition to or in relation to any other Option. The terms of each Option need not be identical,
and the Board need not treat Participants uniformly. Except as otherwise provided by the Plan or a particular Option, any determination
with respect to an Option may be made by the Board at the time of grant or at any time thereafter. At the discretion of the Board
upon the request of a Participant, any Option granted hereunder may, to the extent exercisable, be settled by a cash payment equal
to the difference between the exercise price and the then current Fair Market Value of the Common Stock.

 

(c)       In
the event of a consolidation, reorganization, merger or sale of all or substantially all of the assets of the Bank, in each case
in which outstanding shares of Common Stock are exchanged for securities, cash or other property of any other corporation or business
entity or in the event of a liquidation of the Bank, the Board will provide for any one or more of the following actions, as to
outstanding options: (i) provide that such options shall be assumed, or equivalent options shall be substituted, by the acquiring
or succeeding corporation (or an affiliate thereof), provided that any such options substituted for Incentive Stock Options shall
meet the requirements of Section 424(a) of the Code, (ii) upon written notice to the Participants, provide that all unexercised
options will terminate immediately prior to the consummation of such transaction unless exercised (to the extent then exercisable)
by the Participant within a specified period following the date of such notice, (iii) make or provide for a cash payment to the
Participants equal to the difference between (A) the value of the consideration received by shareholders of the Bank for each share
surrendered in the merger (the "Merger Price") times the number of shares of Common Stock subject to such outstanding
Options (to the extent then exercisable at prices not in excess of the Merger Price) and (B) the aggregate exercise price of all
such outstanding Options, in exchange for the termination of such Options, and (iv) provide that all or any outstanding Options
shall become exercisable in full immediately prior to such event.

 

     

     

    

 

(d)       The
Participant shall pay to the Bank, or make provision satisfactory to the Board for payment of, any taxes required by law to be
withheld in respect of Options under the Plan no later than the date of the event creating the tax liability. In the Board's sole
discretion, a Participant may elect to have such tax obligations paid, in whole or in part, in shares of Common Stock, including
shares retained from the Option creating the tax obligation. For withholding tax purposes, the value of the shares of Common Stock
shall be the Fair Market Value on the date the withholding obligation is incurred. The Bank may, to the extent permitted by law,
deduct any such tax obligations from any payment of any kind otherwise due to the Participant.

 

(e)       For
purposes of the Plan, the following events shall not be deemed a termination of service of a Participant:

 

(i)      a transfer to the employment
of the Bank from a subsidiary or from the Bank to a subsidiary, or from one subsidiary to another, or

 

(ii)     an approved leave of
absence for military service or sickness, or for any other purpose approved by the Bank, if the Participant's right to reemployment
is guaranteed either by a statute or by contract or under the policy pursuant to which the leave of absence was granted or if the
Board otherwise so provides in writing.

 

(f)        The
Board may at any time, and from time to time, amend, modify or terminate the Plan, subject to obtaining any necessary approval
of the Superintendent, or any outstanding Option held by a Participant, including substituting therefore another Option of the
same or a different type or changing the date of exercise or realization, provided that the Participant's consent to each action
shall be required unless the Board determines that the action, taking into account any related action, would not materially and
adversely affect the Participant, and further provided that no amendment that would (i) increase the number of shares as to which
options may be granted; (ii) change the number of shares which may be optioned to any single individual; (iii) decrease an option
price; (iv) extend the term of the plan or of an option; or (v) change the persons or category of persons eligible to be granted
options may be adopted without the approval of the Bank’s shareholders and the Superintendent; provided, further however,
that no such amendment or modification will be effective if such amendment or modification would cause the Plan to fail to comply
with the requirements of Rule 16b-3 under the Act or any successor or replacement regulation.

 

Section 9. Miscellaneous

 

(a)       No
person shall have any claim or right to be granted an Option, and the grant of an Option shall not be construed as giving a Participant
the right to continued employment or service on the Bank's Board. The Bank expressly reserves the right at any time to dismiss
a Participant free from any liability or claim under the Plan, except as expressly provided in the applicable Option.

 

(b)       Nothing
contained in the Plan shall prevent the Bank from adopting other or additional compensation arrangements.

 

(c)       Subject
to the provisions of the applicable Option, no Participant shall have any rights as a shareholder (including, without limitation,
any rights to receive dividends, or non-cash distributions with respect to such shares) with respect to any shares of Common Stock
to be distributed under the Plan until he or she becomes the holder thereof.

 

(d)       Notwithstanding
anything to the contrary expressed in this Plan, any provisions hereof that vary from or conflict with any applicable Federal or
State securities laws (including any regulations promulgated thereunder) shall be deemed to be modified to conform to and comply
with such laws.

 

(e)       No
member of the Board shall be liable for any action or determination taken or granted in good faith with respect to this Plan nor
shall any member of the Board be liable for any agreement issued pursuant to this Plan or any grants under it. Each member of the
Board shall be indemnified by the Bank against any losses incurred in such administration of the Plan, unless his action constitutes
serious and willful misconduct.

 

     

     

    

 

(f)       This
Plan shall become effective upon the final approval from the Superintendent in accordance with Section 26.4 of the General Regulation
of the Superintendent.

 

(g)       The
Plan shall be in effect for a period of ten (10) years after approval of the Plan by the Bank's Shareholders, but then outstanding
Options may extend beyond such date.

 

(h)       To
the extent that State laws shall not have been preempted by any laws of the United States, the Plan shall be construed, regulated,
interpreted and administered according to the other laws of the State of New York.

 

(i)       The
Plan is subject to the provisions of the New York Banking Law, section 140-a, the regulations of the Superintendent and any other
applicable law or regulation.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00319-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00319-of-00352.parquet"}]]