Document:

Description of Capital Stock Exhibit  (00403253.DOCX;1)

Exhibit 10.7
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is executed as of this 30th day
of January 2015 by and between Hudson Valley Investment Advisors, Inc., a New York
corporation, with its principal office at 117 Grand Street, Goshen, NY 10924 ("HVIA" or the
"Company"), and Gustave J. Scacco (the "Executive").
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WHEREAS, the Board of Directors of HVIA desires to employ the Executive in the
position of Chief Executive Officer and Chief Investment Manager of HVIA under such terms and conditions as are set forth herein; and sc),
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WHEREAS, the Executive desires to serve HVIA in such capacity pursuant to the terms
set forth herein;
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NOW THEREFORE, in consideration of these premises, the mutual covenants contained
herein, and other good and valuable consideration. the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows.
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Article 1
EMPLOYMENT
	1.1	Employment.

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HVIA hereby employs the Executive to serve as Chief Executive Officer and Chief
Investment Manager according to the terms and conditions of this Agreement and for the period
stated in Section 1.3. The Executive hereby accepts employment according to the terms and
conditions of this Agreement and for the period stated in Section 1.3. Executive shall commence
employment on February 23, 2015.
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	1.2	Duties.

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(a) The Executive shall report directly to the Board of Directors of HVIA (the
"Board"), or its designee, and shall perform the duties of Chief Executive Officer and Chief
Investment Manager under the supervision of the Board. The Executive shall have responsibility
and authority to supervise and direct the management and administration of all facets of the
operation of HVIA, in accordance with the policies, procedure -and goals established by the
Board, and in compliance with applicable Federal and Slate laws and regulations. The
Executive’s duties shall include, but not be limited to, the authority to hire, compensate (within
budgetary limits), and terminate HVIA employees, provided that the hiring (and the terms of
employment with respect thereto) or the termination of senior or key employees of HVIA shall
be subject to the prior approval of the Board.
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(b) The Executive shall serve HVIA faithfully, diligently, competently, and to the
best of the Executive’s ability. The Executive shall exclusively devote full working time, energy,
and attention to the business of HVIA and to the promotion of HVIA’s interests throughout the
term of this Agreement. During the term of this Agreement, the Executive shall not, without the
written consent of the Board of HVIA, render services in any capacity, whether as an owner,

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employee, independent contractor or otherwise, to or for any person, firm, company, or other
entity or organization, whether or not compensated, and regardless of the form in which the
compensation, if any, is paid and regardless of whether it is paid directly or indirectly to the
Executive. Notwithstanding the preceding sentence, the Executive shall participate in such
professional and community activities that are beneficial to, and serve the interests of HVIA.
Executive may serve as a member of the board of directors of business, community, professional,
and charitable organizations, subject to the prior approval of the Board of HVIA; provided that in
each case such service shall not interfere with the performance of the Executive’s duties under
this Agreement, violate the provisions of Articles 6 and 7 hereof, or violate HVIA’s ethics and
conflict of interest policies (including those of HVIA’s parent, Orange County Bancorp, Inc.
("OCBI") or any Federal or state securities and banking laws or regulations thereunder.
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(c) The Executive may be appointed a member of the Board of HVIA, subject to the
requirements of the by-laws of HVIA, but shall not be eligible for election as an officer of the
Board. In the event that the Executive is appointed a member of the Board, the Executive shall
be subject to the Board’s procedural rules and customary practices for recusal of members. The
Executive shall not receive the compensation and benefits provided to Board members.
Notwithstanding anything in this Agreement to the contrary, the Executive acknowledges
and agrees that, if appointed to the Board of HVIA, he shall resign as a director of the Board
effective immediately upon termination of the Executive’s employment for any reason under
Article 3 of this Agreement, regardless of whether his term as director has expired or not. If
Executive fails to formally resign as provided above, he shall be deemed to have resigned, and
all payments and benefits to him under this Agreement (other than accrued Base Salary, expense
reimbursement, and accrued benefits to which Executive is entitled through the date on which his
termination becomes effective) shall be stayed pending receipt of such formal resignation, except
that this sentence shall not apply if Executive’s termination of employment is as a result of death.
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(d) Executive acknowledges and agrees that the nature of his position and
responsibilities as Chief Executive Officer and Chief Investment Manager HVIA require that he
reside in Orange County, New York. Therefore, Executive covenants and agrees that he will
establish a residence in Orange County, New York no later than May 1, 2015.
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	1.3	Term.

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		(a)	 Subject to the termination provisions set forth below, this Agreement shall be

effective as of February 23, 2015 (the "Effective Date") and shall remain in effect until
expiration on February 22, 2017 (the "Initial Term"), and shall automatically renew for one-year
periods, subject to ninety (90) days written notice of non-renewal by either party prior to the
expiration of the Initial Term and thereafter with respect to each one-year term of renewal. If the
term of this Agreement is not renewed, this Agreement shall nevertheless remain in force until
the Initial Term, or each subsequent one-year term, if any, expires. References herein to the term
of this Agreement mean the Initial Term, as the same may be renewed.
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Article 2
COMPENSATION AND BENEFITS
2.1 Base Salary.
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In consideration of the Executive’s performance of the obligations under this Agreement,
HVIA shall pay or cause to be paid to the Executive a salary at the annual rate of $275,000.00,
payable in accordance with HVIA’s normal payroll practices, and subject to customary
withholding taxes and such other employment taxes as are imposed by law. The Executive’s
salary, as the same may be modified from time to time, is referred to in this Agreement as the
"Base Salary." On or about June 30, 2015, the Board shall review Executive’s performance from
the date of hire through such review date ("Short-Term Performance") measured against the
performance metrics described in Exhibit "A" to this Agreement. Using the Performance Rating
grid set forth in Exhibit "B" to this Agreement, the Board of HVIA shall assess, in its sole and
absolute discretion, Executive’s Short-Term Performance. If, and only if, Executive achieves an
over-all average rating of "3" or higher with respect to these performance metrics, his Base
Salary shall be increased by $25,000.00, for a total Base Salary of $300,000.00, effective as of
July 1, 2015. If Executive does not achieve an average rating of "3" in respect of his Short-Term
Performance, his Base Salary shall remain at $275,000.00, subject to future modification
pursuant to HVIA’s annual salary review process.
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Commencing in 2016, the Board of HVIA shall annually review and consider the
Executive’s Base Salary and may adjust the Base Salary as it deems appropriate (except that
Executive’s Base Salary shall not be decreased), taking into account the performance of HVIA
and the Executive, and other factors that the Board of HVIA considers relevant to the salary of
the Executive.
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2.2 Benefit Plans and Perquisites.
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For as long as the Executive is employed by HVIA, the Executive shall be eligible (x) to
participate in any and all employee benefit plans in effect from time to time, including without
limitation plans providing retirement, medical, dental, disability, and group life benefits existing
on the date of this Agreement or adopted after the date of this Agreement, provided that the
Executive satisfies the eligibility requirements for any such plans or benefits, and (y) to receive
any and all other fringe benefits provided from time to time. Payment of any amount or accrual
of benefits pursuant to (x) above shall be subject to the vesting provisions of the relevant benefit
plan or program. In view of the Executive’s eligibility for a specific individual incentive
arrangement (as described in Section 2.3 below), Executive shall not be eligible for any broadbased HVIA incentive compensation plan or program that may from time to time be available to employees of HVIA.
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2.3 Performance-Based Bonus.
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(a) Executive shall be eligible for an annual bonus that reflects the financial and other
performance of HVIA and the Executive’s contributions thereto (the "Annual Performance
Bonus"). The amount of, and the performance criteria with respect to, the Annual Performance
Bonus shall be determined in the sole discretion of the Board of HVIA. For the fiscal year

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ending December 31, 2015, the Annual Performance Bonus shall be calculated as follows: (A)
Executive shall receive $150,000.00 if he achieves an average rating of "3" (on a scale of "1" to
"5"), as determined by the Board of HVIA in its sole discretion, with respect to Metrics 1
through 6 set forth in Exhibit "A" to this Agreement, utilizing the rating criteria set forth in
Exhibit "B" to this Agreement; and (B) Executive shall receive an additional sum under (i), (ii),
or (iii), as applicable: (i) $50,000.00, if HVIA’s Net Income for the fiscal year ending December
31, 2015 equals the Minimum Threshold set forth in Exhibit "C" to this Agreement; or (ii)
$60,000.00, if HVIA’s Net Income for Fiscal Year 2015 is equal to or greater than 110% but less
than 120% of the Minimum Threshold set forth in Exhibit "C" to this Agreement; or (iii)
$70,000.00, if HVIA’s Net Income for Fiscal Year 2015 is equal to or greater than 120% of the
Minimum Threshold set forth in Exhibit "C" to this Agreement.
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For Fiscal Year 2015 only, if the Annual Performance Bonus, as calculated pursuant to
the preceding paragraph is less than $100,000.00, Executive shall be paid a guaranteed
minimum Annual Performance Bonus of $100,000.00.
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The payment date of any Annual Performance Bonus payable to Executive shall be in
accordance with HVIA’s customary practice with respect to bonus payments. Executive shall
forfeit any Annual Performance Bonus if he is not employed by HVIA on the payment date.
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		(b)	 The right of the Executive to receive an Annual Performance Bonus in calendar

years following 2015 shall be based on the achievement by the Executive of performance goals,
which shall be comprised of financial and managerial goals. Performance goals shall be
established by the Board of HVIA in consultation with the Executive. The payment of any
Annual Performance Bonus shall be subject to the Board’s assessment, in its sole discretion, of
the Executive’s performance.
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2.4 Reimbursement of Business Expenses.
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The Executive shall be entitled to reimbursement for all reasonable business expenses
incurred performing the obligations under this Agreement, including but not limited to all
reasonable business travel and entertainment expenses incurred while acting at the request of or
in the service of HVIA and reasonable expenses for attendance at annual and other periodic
meetings of trade or professional associations of which Executive is or may become a member.
The Executive shall be entitled to reimbursement of country club dues, as approved by the Board
of HVIA, for membership in a country club located in Orange County. Requests for
reimbursement of business expenses shall be submitted monthly to the Board of HVIA, or its
designee. Reimbursement of expenses shall be made in accordance with HVIA’s policies and
procedures relating to the substantiation and documentation of expenses.
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2.5 Relocation Allowance.
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The Executive shall be entitled to reimbursement for reasonable relocation expenses in an
amount not to exceed a maximum of ten thousand ($10,000.00) dollars (regardless of the number
of household moves involved in the relocation.) Reimbursement of relocation expenses shall be

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subject to HVIA’s reimbursement policies and procedures relating to the substantiation and documentation of expenses, which shall include receipts for services provided.
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2.6 Vacation; Leave.
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The Executive shall be entitled to sick leave and paid annual vacation in accordance with
policies established from time to time by HVIA. In the event of termination of employment, for
whatever reason, all unused vacation as of the date of termination shall be forfeited. In calendar
year 2015, Executive shall be entitled to the pro-rated portion of four (4) weeks vacation based
upon his actual days of service from the Effective date through December 31, 2015. Thereafter,
Executive shall be entitled to four (4) weeks vacation each year.
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2.7 Corporate Liability Insurance.
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HVIA shall maintain or cause to be maintained corporate liability insurance covering the
Executive throughout the term of this Agreement.
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Article 3
EMPLOYMENT TERMINATION
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3.1 Termination of Employment.
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(a) The Executive’s employment shall terminate automatically at the Executive’s
death. If the Executive dies in active service to HVIA, the Executive’s estate shall receive any
sums due to the Executive as Base Salary, accrued and vested benefits as of the date of death,
subject to the payout provisions of such plans, and reimbursement of expenses through the end of
the month in which death occurred.
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(b) By delivery of written notice thirty (30) days in advance to the Executive, HVIA
may terminate the Executive’s employment if the Executive is disabled. For purposes of this
Agreement the Executive shall be considered "disabled" if two physicians of a panel of three
independent physicians (one selected by HVIA, one selected by the Executive and one selected
by the two designated physicians) determines that, because of illness or accident, the Executive
is unable to perform the Executive’s duties and will be unable to perform the Executive’s duties
for a period of ninety (90) consecutive days. The Executive shall not be considered disabled,
however, if the Executive returns to work on a full-time basis within thirty (30) days after HVIA
gives notice of termination due to disability. During the period of incapacity leading up to the
termination of the Executive’s employment under this provision, HVIA shall continue to pay the
full Base Salary at the rate then in effect and all perquisites and other benefits (other than any
bonus) until the Executive becomes eligible for benefits under any disability plan or insurance
program maintained by HVIA, provided that the amount of HVIA’s payments to the Executive
under this Section 3.1(b) shall be reduced by the sum of the amounts, if any, payable to the
Executive for the same period under any disability benefit or pension plan or program covering
the Executive.
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3.2Involuntary Termination with Cause.
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HVIA may terminate the Executive’s employment for Cause. If the Executive’s
employment terminates for Cause, the Executive shall receive the Base Salary through the date
on which termination becomes effective and reimbursement of expenses to which the Executive
is entitled when termination becomes effective. For purposes of this Agreement, "Cause" means
any of the following:
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(a) an act of fraud, embezzlement, or theft while employed by HVIA, or indictment
or conviction of the Executive for, or plea of no contest to, a felony, conviction of or plea of no
contest to a misdemeanor involving moral turpitude, or the arrest and incarceration of the
Executive for acts by the Executive involving moral turpitude,
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(b) gross negligence, insubordination, disloyalty, or dishonesty in the performance of
the Executive’s duties as an officer of HVIA; willful or reckless failure by the Executive to
adhere to HVIA’s written policies (or those of OCBI); intentional wrongful damage by the
Executive to the business or property of HVIA, OCBI, or any of its affiliates (collectively, the
"HVIA Group"), including without limitation their reputation, which in the Board’s sole
judgment causes material harm to the HVIA Group,
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(c) removal of the Executive from office or permanent prohibition of the Executive
from participating in the affairs ofHVIA or prohibition of the Executive from participating in the
securities or financial services business by any order or decree issued by a court, tribunal or
regulatory agency, and
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(d) acts or omissions in the performance of the Executive’s duties having a material
adverse effect on the HVIA Group that were not done or omitted to be done in good faith or
which involved intentional misconduct or a knowing violation of law.
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3.3 Voluntary Termination by the Executive without Good Reason.
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If the Executive terminates employment without Good Reason, the Executive shall
receive the Base Salary and expense reimbursement to which the Executive is entitled through
the date on which the termination becomes effective.
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3.4 Involuntary Termination without Cause and Voluntary Termination with
Good Reason.
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With written notice to the Executive thirty (30) days in advance, the Board of HVIA may
terminate the Executive’s employment without Cause. Termination shall take effect at the end of
the 30-day period. With advance written notice to the Board of HVIA as provided in clause (y),
the Executive may terminate employment for Good Reason. If the Executive’s employment
terminates involuntarily without Cause or voluntarily but with Good Reason, the Executive shall
be entitled to the benefits specified in Article 4 of this Agreement.
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For purposes of this Agreement, a voluntary termination by the Executive shall be

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considered a voluntary termination with Good Reason if the conditions stated in both clauses (x)
and (y) are satisfied:
(x) a voluntary termination by the Executive shall be considered a voluntary
termination with Good Reason if any of the following occur without the Executive’s written
consent:
		(1)	a material diminution of the Executive’s Base Salary;

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(2) a material diminution in the Executive’s authority, job responsibilities or
duties;
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(3) a change in the principal geographic location at which the Executive must
perform services for HVIA by more than thirty-five (35) miles from the location where it is
contemplated that Executive will be performing his duties,
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(y) the Executive must give notice to the Board of HVIA of the existence of one or
more of the conditions described in clause (x) within thirty (30) days after the initial existence of
the condition and HVIA shall have thirty (30) days thereafter to remedy the condition. In
addition, the Executive’s voluntary termination because of the existence of one or more of the
conditions described in clause (x) must occur within sixty (60) days after the initial existence of
the condition. For purposes of this clause (y), the time when "notice" must be provided to the
Board of HVIA shall be when the Executive has knowledge of the existence of any of the
conditions enumerated in (x) above. Notice under this Section 3.4 shall otherwise be provided as
set forth in Section 8.4 of this Agreement.
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3.5 Immediate Transitioning Upon Termination of Employment.
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Executive acknowledges and agrees that in order to assure an efficient transition of
management, he shall immediately upon termination of employment for any reason whatsoever
under this Article 3, cooperate with the Board of HVIA, or its designee, in returning all
materials, keys, and other property furnished to Executive by HVIA, including but not limited to
HVIA property described in Section 6.2 of this Agreement and, further, Executive shall
immediately vacate his office.
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Article 4
SEVERANCE COMPENSATION
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4.1 Severance after Termination without Cause or Termination for Good Reason.
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(a) Subject to the possibility that severance after employment termination might be
delayed under Section 4.1(b) if the Executive’s employment is terminated by HVIA without
Cause or if the Executive terminates employment with Good Reason, HVIA shall pay him a
severance payment equal to six (6) months of Base Salary (at the rate in effect on the termination
date) payable over a period of six (6) months commencing on the first payroll period following
the Executive’s termination date, in accordance with HVIA’s usual payroll practices and subject
to applicable tax withholding. During the period that such severance payments are being made,
the Executive shall not be eligible to participate in any bonus, pension, 401(k), or other

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retirement, health or welfare benefit plan, except as the Executive may be eligible to participate
pursuant to the terms of the Consolidated Omnibus Budget Reconciliation Act relating to health
care continuation coverage. The Executive acknowledges and agrees that the severance under
this Section 4.1(a) shall not be payable if compensation and/or benefits are payable or shall have
been paid to the Executive under Article 5 of this Agreement.
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(b)If employment termination occurs when the Executive is a specified employee
within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, and the
payments under Section 4.1(a) would be considered deferred compensation under Section 409A,
and finally if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) is
not available, then any payment that is triggered by the Executive’s separation from service shall
be delayed for at least six months after employment termination and such delayed amounts shall
be paid to the Executive in a single lump sum without interest on the first day of the seventh
month after the month in which the Executive’s employment terminates. References in this
Agreement to Section 409A of the Internal Revenue Code of 1986 include rules, regulations, and
guidance of general application issued by the Department of the Treasury under Internal
Revenue Code Section 409A or under any successor provision of a similar nature.
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(c) Any severance payment pursuant to this Section 4.1 shall be contingent upon the
Executive executing a valid release at the time of payment of all claims against the HVIA Group
without revocation thereof.
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Article 5
CHANGE IN CONTROL BENEFITS
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5.1 Change in Control Benefits.
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If a Change in Control occurs during any Term of this Agreement while the Executive is
actively employed by HVIA, and the Executive’s employment terminates involuntarily but
without Cause, or if the Executive voluntarily terminates employment with Good Reason, in
each case such termination occurs within twelve months of the Change in Control, HVIA shall
make or cause to be made a lump-sum payment to the Executive in an amount in cash equal to
two times the Executive’s Base Salary (at the rate in effect when the Change in Control occurs).
Payments under this Section 5.1 shall be made no later than ninety (90) days following the date
of the Change in Control. The amount payable to the Executive hereunder shall not be reduced
to account for the time value of money or discounted to present value. Any payment to the
Executive pursuant to this Section 5.1 shall be contingent on his executing a valid release,
without revocation thereof.
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5.2 Change in Control Defined.
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For purposes of this Agreement "Change in Control" means a change in control as
defined in Internal Revenue Code Section 409A and rules, regulations, and guidance of general
application thereunder issued by the Department of the Treasury, including:
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(a) Change in ownership: a change in ownership of HVIA occurs on the date any one

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person or persons acting as a group (but excluding an intra family acquisition or transfer of stock
between members of the Morrison family) accumulates ownership of OCBI stock constituting
more than fifty (50%) percent of the total voting power of OCBI stock, or
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(b) Change in effective control: any one person or persons acting as a group (but
excluding an intra family acquisition or transfer of stock between members of the Morrison
family) acquires within a 12-month period ownership of OCBI stock possessing forty (40%)
percent or more of the total voting power of OCBI stock, or
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(c) Change in ownership of a substantial portion of assets: a change in ownership of a
substantial portion of OCBI’s assets occurs if in a 12-month period any one person or persons
acting as a group (but excluding an intra family acquisition or transfer of stock between members
of the Morrison family) acquires from OCBI assets having a total gross fair market value equal
to or exceeding 40% of the total gross fair market value of all of OCBI’s assets immediately
before the acquisition or acquisitions. For this purpose, gross fair market value means the value
of OCBI’s assets, or the value of the assets being disposed of, determined without regard to any
liabilities associated with the assets.
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5.3 Termination for Which No Benefits Are Payable.
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Notwithstanding anything in this Agreement to the contrary, the Executive shall be
entitled to no benefits under this Article 5 if the Executive’s employment terminates with Cause,
if the Executive dies while actively employed by HVIA, or if the Executive becomes totally
disabled while actively employed by HVIA. For purposes of this Section 5.3, the term "totally
disabled" means that because of injury or sickness the Executive is unable to perform his duties
under this Agreement. The benefits, if any, payable to the Executive or the Executive’s
beneficiary or estate relating to the Executive’s death or disability shall be determined solely by
such benefits plans or arrangements as HVIA may have with the Executive relating to death or
disability, not this Article 5 of this Agreement.
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5.4 Limitation on Benefits under Certain Circumstances.
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If the payments and benefits pursuant to this Article 5, either alone or together with any
other payments and benefits the Executive may be entitled to receive from HVIA, would
constitute a "parachute payment" under Section 280G of the Code, and if all or any portion of
such payments are subject to the excise tax imposed by Section 4999 of the Code, such payments
and benefits shall be reduced or revised, in the manner determined by HVIA, by the amount, if
any, which is the minimum necessary to result in no portion of such payments and benefits being
non-deductible to HVIA pursuant to Section 280G of the Code and subject to the excise tax
imposed under Section 4999 of the Code.
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Article 6
CONFIDENTIALITY AND CREATIVE WORK
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6.1 Non-Disclosure.
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During the term of this Agreement and thereafter, the Executive covenants and agrees not
to reveal to any person, firm, or company any confidential information of any nature concerning
the HVIA Group, or anything connected therewith, and to keep secret and retain in the strictest
confidence, and hold in a fiduciary capacity for the benefit of the HVIA Group all secret or
confidential information, knowledge or data relating to the HVIA Group, including without
limitation, any data, information, ideas, knowledge and papers pertaining to the customers,
prospective products or business methods of the HVIA Group, including without limitation the
business methods, plans and procedures of the HVIA Group that shall have been obtained by the
Executive during the Executive’s employment with HVIA and that shall not be or become public
knowledge (other than by impermissible acts by the Executive or representatives of the HVIA
Group), contract strategies, allocation of financial resources, financial plans and strategies,
policies and negotiation strategies, existing contracts and contracts under negotiation, identities
of clients and/or customers of the HVIA Group or of the HVIA Group’s clients, customers, and
markets and non-public personal and financial information and the investment models and
strategies with respect to the handling of the investment and trust matters of the customers and
clients of the HVIA Group to which Executive may have become aware or knowledgeable of by
reason of his employment with HVIA (hereinafter referred to as "Confidential Information" or
with respect to confidential or secret services, techniques, processes, economic, investment or
any similar models of the HVIA Group (hereinafter referred to as "Trade Secrets" and other
works made or conceived by Executive or any employee of the HVIA Group while Executive
was employed by HVIA (or within one year of the termination of Executive’s employment with
HVIA if such works are based on or related to Confidential Information or Trade Secrets),
whether solely or jointly with any other person or organization during or outside of employment
hours with the HVIA Group (hereinafter referred to as the "Works").
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After termination of the Executive’s employment with HVIA, the Executive shall not,
without the prior written consent of HVIA or as may otherwise be required by law or legal
process after reasonable advance written notice to the Board of HVIA, use, communicate or
divulge any Confidential Information or Trade Secrets, directly or indirectly, to anyone other
than HVIA and those designated by it. The restrictions and covenants set forth in this Section
6.1 shall apply to any investment models and strategies developed by Executive prior to his
employment with HVIA. HVIA shall have the right to market and sell any such produces,
models and strategies as Works of HVIA. Executive agrees that he shall provide HVIA with
documentation of the proprietary investment models and strategies developed by Executive prior
to his employment with HVIA.
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Despite the foregoing, Confidential Information excludes information that - as of the
date hereof or at any time after the date hereof - is published or disseminated without obligation
of confidence or that becomes a part of the public domain (x) by or through action of HVIA, or
(y) otherwise than by or at the direction of the Executive. This Section 6.1 does not prohibit
disclosure required by an order of a court having jurisdiction or a subpoena from an appropriate

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governmental agency or disclosure made by the Executive in the ordinary course of business and
within the scope of the Executive’s authority.
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6.2 Return of Materials.
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The Executive agrees to deliver or return to HVIA upon termination, or upon expiration
of this Agreement, all written information and any other similar items furnished by the HVIA
Group or prepared by the Executive in connection with the Executive’s services hereunder
(whether maintained at his office, home or elsewhere, including all copies of all management
studies, business or strategic plans, budgets, notebooks and other printed, typed or written
materials, documents, diaries, calendars and data of or relating to the HVIA Group or its
personnel or affairs, including clients lists and client records. The Executive shall retain no
copies thereof after termination of this Agreement or termination of the Executive’s employment.  The Executive shall immediately return to HVIA all HVIA Group passwords, credit cards, keys, beepers, laptop computers, cell phones and similar items furnished to Executive in connection with his employment with HVIA.
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6.3 Creative Work.
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The Executive agrees that all creative work and work product, including but not limited
to all technology, business management tools, processes, software, patents, trademarks, and
copyrights developed by the Executive during the term of this Agreement, regardless of when or
where such work or work product was produced, constitutes work made for hire, all rights of
which are owned by HVIA. The Executive hereby assigns to HVIA all rights, title, and interest,
whether by way of copyrights, trade secret, trademark, patent, or otherwise, in all such work or
work product, regardless of whether the same is subject to protection by patent, trademark, or
copyright laws.
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6.4 Affiliates’ Confidential Information is Covered; Confidentiality Obligation Survives
Termination.
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For purposes of this Agreement, the term "affiliate" of HVIA includes any entity that
directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under
common control with HVIA and OCBI. The rights and obligations set forth in this Article 6
shall survive termination of this Agreement.
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6.5Confidentiality of Agreement.
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The Executive covenants and agrees that, except as may be required by applicable legal
process, during any Term of this Agreement and thereafter, he shall not disclose the terms of this
Agreement to any person or entity other than the Executive’s accountants, financial advisors,
attorneys or spouse, provided that such accountants, financial advisors, attorneys and spouse
agree not to disclose the terms of this Agreement to any other person or entity.
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6.6 Injunctive Relief.
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The Executive acknowledges that it is impossible to measure in money the damages that
will accrue to the HVIA Group if the Executive fails to observe the obligations imposed by this
Article 6. Accordingly, if HVIA institutes an action to enforce the provisions hereof, the
Executive hereby waives the claim or defense that an adequate remedy at law is available to the
HVIA Group, and the Executive agrees not to urge in any such action the claim or defense that
an adequate remedy at law exists. The confidentiality and remedies provisions of this Article 6
shall be in addition to and shall not be deemed to supersede or restrict, limit, or impair the rights
of the HVIA Group under applicable state or Federal statute or regulation dealing with or
providing a remedy for the wrongful disclosure, misuse, or misappropriation of trade secrets or
proprietary or confidential information.
Article 7
COMPETITION AFTER EMPLOYMENT TERMINATION
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7.1Covenant Not to Solicit Employees.
​
The Executive agrees not to solicit, either directly or indirectly, the services of any officer
or employee of the HVIA Group for one year after the Executive’s termination of employment.
​
7.2 Covenant Not to Compete and Not to Solicit Customers.
​
(a) During the period commencing on the Effective Date and ending twelve months
after the termination of Executive’s employment (the "Restrictive Period"), the Executive shall
not, within the Territory, either directly or indirectly, engage in, have an interest in, or otherwise
be employed by or associated with (whether as owner, operator, partner, member, manager,
employee, officer, director, consultant, advisor, independent contractor, lender, representative)
any Financial Institution, or any entity engaged in the securities business, the insurance business,
or any trust company or trust division of any bank, including, but not limited to, any Investment
Advisor, as that term is defined in the Investment Advisers Act of 1940, or any Investment
Company, as that term is defined in the Investment Company Act of 1940, any hedge fund, or
any type of investment fund engaged in the business of investing, reinvesting, owning, holding
or trading in securities, any entity or organization that engages in the business of advising others,
whether directly or through publication or writings, as to the value of securities or as to the
advisability of investing in, purchasing, or selling securities, or who, issues or promulgates
analysis or reports concerning securities, or any other entity engaged in any aspect of the
securities business or trust services (together with the Financial Institutions, the "Restricted
Entities"), or otherwise assist or permit his name to be used in connection with the activities of
any Restricted Entity. In addition, the Executive shall not, during the Restrictive Period, induce
or attempt to induce any Customer of the HVIA Group to seek investment advisory services,
trust services, broker-dealer services, Financial Products or Services from any Restricted Entity
nor shall Executive communicate to any Restricted Entity the names or addresses or any
financial information concerning any Customer of the HVIA Group.
​
(b) For purposes of this Section 7.2:
​

​

(i) the term Customer means any Person to whom the HVIA Group is
providing investment advisory services through HVIA, or
Financial Products or Services through affiliates of HVIA, on the
date of the Executive’s employment termination or within the six
months preceding Executive’s termination of employment.
​
(ii) the term Financial Institution means any bank, savings association,
or bank or savings association holding company, trust company,
credit union, or any other institution, the business of which is
engaging in activities that are financial in nature or incidental to
such financial activities as described in Section 4(k) of the Bank
Holding Company Act of 1956, other than the bank affiliate of the
HVIA Group.
​
(iii) the term Financial Product or Service means any product or service
that a Financial Institution or a financial holding company could
offer by engaging in any activity that is financial in nature or
incidental to such a financial activity under Section 4(k) of the
Bank Holding Company Act of 1956 and that is offered by the
HVIA Group on the date of the Executive’s employment
termination, including but not limited to banking activities and
activities that are closely related and a proper incident to banking.
​
(iv)the term Person means any individual or individuals, corporation,
partnership, fiduciary or association.
​
(v) the term Territory means the area within a sixty (60) mile
radius of the principal office of HVIA at the date of Executive’s
employment termination; provided, however, that solely for
purposes of the non-compete provisions of Section 7.2(a), the
Territory shall not include New York City.  The covenant not induce or
attempt to induce any Customer of the HVIA Group to seek
investment advisory services, trust services, broker-dealer services,
Financial Products or Services from any Restricted Entity or to
communicate to any Restricted Entity the names or addresses or
any financial information concerning any Customer of the HVIA
Group shall apply as set forth in Section 7.2(a).
​
(c) If any provision of this Section 7.2 or any word, phrase, clause, sentence or other
portion thereof (including, without limitation, the geographical and temporal restrictions
contained therein) is held to be unenforceable or invalid for any reason, the unenforceable or
invalid provision or portion shall be modified or deleted so that the provisions hereof, as
modified, are legal and enforceable to the fullest extent permitted under applicable law.
​
​
​

​

7.3 Injunctive and Other Relief.
​
Because of the unique character of the services to be rendered by the Executive
hereunder, the Executive acknowledges and agrees that the restrictions on his competitive
activities under this Article 7 are reasonable. The Executive further acknowledges and agrees
that the HVIA Group would not have an adequate remedy at law for the material breach or
threatened breach by the Executive of any one or more of the Executive’s covenants in this
Article 7. Accordingly, the Executive agrees that the Employer’s remedies for a material breach
or threatened breach of this Article 7 include but are not limited to (x) forfeiture of any money
representing accrued salary, contingent payments, or other fringe benefits due and payable to the
Executive to the extent permitted under applicable law, (y) forfeiture of any benefits under
Sections 4.1 or 4.2, of this Agreement, and (z) a suit in equity the HVIA Group to enjoin the
Executive from the breach or threatened breach of such covenants. The Executive hereby
waives the claim or defense that an adequate remedy at law is available to the HVIA Group and
the Executive agrees not to urge in any such action the claim or defense that an adequate remedy
at law exists. Nothing herein shall be construed to prohibit the HVIA from pursuing any other or
additional remedies for the breach or threatened breach.
​
7.4 Article 7 Survives Termination But Is Void after a Change in Control.
​
The rights and obligations set forth in this Article 7 shall survive termination of this
Agreement. However, Article 7 shall become null and void effective immediately upon a
Change in Control.
​
Article 8
MISCELLANEOUS
​
8.1 Successors and Assigns.
​
(a) This Agreement is binding on successors. This Agreement shall be binding upon
HVIA and any successor to HVIA, including any persons acquiring directly or indirectly all or
substantially all of the business or assets of HVIA by purchase, merger, consolidation,
reorganization, or otherwise. But this Agreement and HVIA’s obligations under this Agreement
are not otherwise assignable, transferable, or delegable by HVIA. HVIA shall require any
successor to all or substantially all of the business or assets of HVIA expressly to assume and
agree to perform this Agreement in the same manner and to the same extent HVIA would be
required to perform had no succession occurred.
​
(b) This Agreement is personal in nature and is not assignable. Without written
consent of the other parties, no party shall assign, transfer, or delegate this Agreement or any
rights or obligations under this Agreement, except as expressly provided herein. Without
limiting the generality or effect of the foregoing, the Executive’s right to receive payments
hereunder is not assignable or transferable, whether by pledge, creation of a security interest, or
otherwise, except for a transfer by the Executive’s will or by the laws of descent and distribution.
If the Executive attempts an assignment or transfer that is contrary to this Section 8.1, HVIA
shall have no liability to pay any amount to the assignee or transferee.

​

8.2 Governing Law, Jurisdiction and Forum.
​
This Agreement shall be construed under and governed by the internal laws of the State
of New York without giving effect to any conflict of laws provision or rule that would cause the
application of the laws of any jurisdiction other than the State of New York. By entering into
this Agreement, the Executive acknowledges that the Executive is subject to the jurisdiction of
both the Federal and state courts in the State of New York.
​
8.3Entire Agreement.
​
This Agreement sets forth the entire agreement of the parties concerning the employment
of the Executive by HVIA. Any oral or written statements, representations, agreements, or
understandings made or entered into prior to or contemporaneously with the execution of this
Agreement are hereby rescinded, revoked, and rendered null and void by the parties.
​
8.4 Notices.
​
All notices, requests, demands, and other communications hereunder shall be in writing
and shall be deemed to have been duly given if delivered by hand or mailed, certified or
registered mail, return receipt requested, with postage prepaid. Unless otherwise changed by
notice, notice shall be properly addressed to the Executive if addressed to the address of the
Executive on the books and records of HVIA at the time of the delivery of such notice, and
properly addressed to the HVIA if addressed to HVIA’s executive offices.
​
8.5 Severability.
​
If there is a conflict between any provision of this Agreement and any statute, regulation,
or judicial precedent, the latter shall prevail, but the affected provisions of this Agreement shall
be curtailed and limited solely to the extent necessary to bring them within the requirements of
law. If any provision of this Agreement is held by a court of competent jurisdiction to be
indefinite, invalid, void or voidable, or otherwise unenforceable, the remainder of this
Agreement shall continue in full force and effect unless that would clearly be contrary to the
intentions of the parties or would result in an injustice.
​
8.6 Captions and Counterparts.
​
The captions in this Agreement are solely for convenience. The captions do not define,
limit, or describe the scope or intent of this Agreement. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an original but all of which together
shall constitute one and the same instrument.
​
8.7 No Duty to Mitigate.
​
The Executive shall not be required to mitigate the amount of any payment provided for
in this Agreement by seeking other employment. Moreover, the amount of any payment
provided for in this Agreement shall not be reduced by any compensation earned or benefits

​

provided as the result of employment of the Executive or as a result of the Executive being selfemployed after employment termination.
​
8.8 Amendment and Waiver.
​
This Agreement may not be amended, released, discharged, abandoned, changed, or
modified in any manner, except by an instrument in writing signed by each of the parties hereto.
The failure of any party hereto to enforce at any time any of the provisions of this Agreement
shall not be construed to be a waiver of any such provision, nor affect the validity of this
Agreement or any part thereof or the right of any party thereafter to enforce each and every such
provision. No waiver or any breach of this Agreement shall be held to be a waiver of any other
or subsequent breach.
​
8.9  Compliance with Internal Revenue Code Section 409A.
​
HVIA and the Executive intend that their exercise of authority or discretion under this
Agreement shall comply with Section 409A of the Internal Revenue Code of 1986 ("Section
409(A)"). Any payments made pursuant to this Agreement shall be subject to applicable tax or
similar withholding requirements under applicable federal, state or local employment or income
tax laws or similar statutes or other provisions of law then in effect.
​
		(a)	 If when the Executive’s employment terminates the Executive is a specified

employee, as defined in Section 409A of the Internal Revenue Code of 1986, and if any
payments under this Agreement, including Article 5, will result in additional tax or interest to the
Executive because of Section 409A, then despite any contrary provision of this Section 8.9, such
payments shall be made on the first to occur of the (x) a date that is at least six months after
termination of the Executive’s employment for reasons other than the Executive’s death, (y) the
date of the Executive’s death, or (z) any earlier date that does not result in additional tax or
interest to the Executive under Section 409A. As promptly as possible after the end of the period
during which payments are delayed under this provision, the entire amount of the delayed
payments shall be paid to the Executive in a single lump sum. If any provision of this
Agreement does not satisfy the requirements of Section 409A, such provision shall nevertheless
be applied in a manner consistent with those requirements. If any provision of this Agreement
would subject the Executive to additional tax or interest under Section 409A, HVIA shall reform
the provision. However, HVIA shall maintain to the maximum extent practicable the original
intent of the applicable provision without subjecting the Executive to additional tax or interest,
and HVIA shall not be required to incur any additional compensation expense as a result of the
reformed provision. In no event may Executive, directly or indirectly, designate the calendar
year of any payment under this Agreement. Notwithstanding any provision of this Agreement to
the contrary, to the extent any payments due to Executive under this Agreement are conditioned
upon and subject to execution of a release, such payments will commence within the 90 day
period following the termination of employment (as applicable) on the next scheduled payment
date following the date the release becomes effective and will be payable in accordance with
HVIA’s ordinary payroll practices, except that if the period spans two taxable years, the payment
will commence in the later of the two years.
​

​

(b) For purposes of Section 409A of the Code, each payment made under this
Agreement shall be designated as a "separate payment" within the meaning of the Section 409A
of the Code, and references herein to Executive’s "termination of employment" shall refer to
Executive’s separation from service with HVIA within the meaning of Section 409A. To the
extent any reimbursements or in-kind benefits due to Executive under this Agreement constitute
"deferred compensation" under Section 409A of the Code, any such reimbursements or in-kind
benefits shall be paid to Executive in a manner consistent with Treas. Reg. Section 1.409A-
3 (i)(1)(iv).
​
8.10No Conflicting Agreement.
​
The Executive represents and warrants to HVIA that (a) the Executive has not taken,
and/or will return or (with the consent of his former employer) destroy without retaining copies,
all proprietary and confidential materials of his former employer; (b) the Executive has not used
any confidential, proprietary or trade secret information in violation of any contractual or
common law obligation to his former employer; (c) except as previously disclosed to HVIA in
writing, the Executive is not party to any agreement, whether written or oral, that would prevent
or restrict him from engaging in activities competitive with the activities of his former employer,
from directly or indirectly soliciting any employee, client or customer to leave the employ of, or
transfer its business away from, his former employer or, if the Executive is subject to such an
agreement or policy, he has complied with it; and (d) the Executive is not a party to any
agreement, whether written or oral, that would be breached by or would prevent or interfere with
the execution by the Executive of this Agreement or the fulfillment by the Executive of the
Executive’s obligations hereunder.
​
IN WITNESS WHEREOF, the parties have executed this Employment Agreement as of
the date first written above.
​
WITNESS Hudson Valley Investment Advisors, Inc.
​
/s/ Pamela Jones​ ​ By:  /s/ Louis Heimbach​ ​
Dated: February 5, 2015     Louis Heimbach
     Chairman, Board of Directors
​
​
​
  /s/ Gustave J. Scacco​ ​​ ​   
    Gustave J. Scacco 
​

​

Exhibit A
HVIA CEO GOAL CATEGORIES
FIRST YEAR
		●	General Management

		o	Develop and obtain board approval of the strategic plan

		o	Create with the board specific annual goals which address:

		◾	Operational efficiency

		◾	Staff optimization

		◾	Achieving and reinforcing Compliance standards

 ​
		●	Marketplace Leadership

		o	Ability to enhance HVIA brand through personal presentations,

local affiliations and other marketing efforts
 ​
		●	Retention

		o	Articulate approach and report regularly on the retention of existing

clients
		o	Meet with HVIA clients

 ​
		●	Sales Management

		o	Create a sales management strategy, including goals for each

Portfolio Manager which sums to goals for the firm. Goals should
include new clients and new AUM for existing clients
		o	Develop a working and referral relationship with OCTC Trust

Department
		o	Begin to develop relationships with area center of influence CPAs,

attorneys, etc.
		o	Start to develop new sales channels for HVIA

​
		●	Investment Strategy

		o	Gain strong understanding of HVIA investment process

		o	Develop the investment philosophy and process

		o	Create management reporting which compares HVIA results to

appropriate benchmarks
​
		●	Personal Sales

		o	Goals for overall firm sales

		o	Begin role of Senior Portfolio Manager

		o	A payout rate for new business created by the CEO

		o	An annual goal earmarked for new business from new channels

​
		●	Net Income

		o	Net income goal for 2015 is $876,000

		o	Minimum threshold for payout and reward for stretch achievement

* Each category will be evaluated by the Board of Directors with a 5 point scale
January 30, 2014

​

Exhibit C
2015 Net Income Incentive
​
Executive will receive year-end bonus for this category based on achievement of
$860,000 Net Income ("NI") target. Achievement of the target NI will result in a $50,000
payment. A provision for achievement above (and below) the target NI is as follows:
​
% Achievement
of Targeted NI Incentive Payouts
​
         80% $30,000
         90 % $40,000
       100 % $50,000
       110% $60,000
       120% $70,000
​
​
​
​
​
​
​
​
​
January 30, 2014
​

​

Exhibit B
​
Performance Ratings
​
5 = Outstanding - The employee consistently exceeds all the expectations for
responsibilities and objectives, skills, abilities and commitments required for the
job. Possesses superior knowledge of major aspects of the total job and has had
experience in each area. Demonstrated superior knowledge and ability to take
initiative and improve processes and efficiency resulting in positive impact on the
department or organization.
​
4 = Exceeds Expectations - The employee achieves and frequently exceeds
expectations for responsibilities and objectives, skills, abilities, and knowledge for
the job. Seeks to enhance or increase skills, makes recommendations/offers
solutions to improve processes.
​
3 = Meets Expectations - The employee met established expectations for job
responsibilities and objectives of the position. Employee demonstrated requisite
skills, ability, knowledge, and commitment for the job.
​
2 = Improvement Needed - The employee does not always meet the
responsibilities and objectives of the job. Demonstrates some of the job requisite
skills, abilities, and knowledge to do the job, but additional training and/or
commitment required. Individual may still be learning the job and/or willingness to
develop or improve requisite skills and knowledge may be in question.
​
1 = Unsatisfactory Job Performance - Responsibilities of the position have not
been met. Employee does not demonstrate the necessary knowledge, skills,
abilities, and commitment required for the position.
​
​
​
​
​
​
​
January 30, 2014
​

​

FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
​
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) made as of this 21st day of February, 2020 by and among GUSTAVE J. SCACCO (the “Executive”) and HUDSON VALLEY INVESTMENT ADVISORS (“HVIA” or the “Company”).
​
WHEREAS, pursuant to that certain Employment Agreement effective as of January 30, 2015 (the “Agreement”), Executive has been employed as Chief Executive Officer and Chief Investment Manager of HVIA; and
​
WHEREAS, the parties have agreed to amend the Agreement in the manner set forth below.
​
NOW, THEREFORE, in consideration of the mutual promises and undertakings herein contained, the parties agree as follows:
​
1.Amendment to the Agreement.
​
Effective as of the date hereof, the first sentence of the second paragraph of Section 1.2(c) of the Agreement shall be deleted in its entirety and replaced with the following new sentence:
​
“Notwithstanding anything in this Agreement to the contrary, the Executive acknowledges and agrees that if appointed to the Board of Directors of the Company, or the Board of Directors of Orange Bank & Trust Company and/or the Board of Directors of Orange County Bancorp, Inc. (collectively an “Affiliated Company”), Executive shall resign as a director of both the Company Board and Affiliated Company Board (regardless of whether or not his term as a director has expired), effective upon the earlier of: (a) the date Executive terminates his employment with HVIA for any reason under Article 3 of this Agreement;  or (b) the date the Executive no longer holds the job titles set forth in Section 1.1 of this Agreement.”    
​
	2.
	Modification.  All other terms and conditions of the Agreement shall remain in full force and effect, except as modified herein. All terms not defined herein shall have the meanings ascribed thereto in the Agreement.

​
	3.
	Counterparts.  This Amendment 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.

​
	4.
	Governing Law.  This Amendment shall be governed by and construed in accordance with the laws of the State of New York.

 ​
​

​

​
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.
​
WITNESSHUDSON VALLEY INVESTMENT ADVISORS
/s/ Pamela Jones By: /s/ Peter R. Larkin
Dated: February 21, 2020Duly authorized representative 
​
​
WITNESS
/s/ Pamela Jones By: /s/ Gustave J. Scacco
Dated: February 21, 2020GUSTAVE J. SCACCO

​Document

Exhibit 4.5

DESCRIPTION OF REGISTRANT’S SECURITIES REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934
The following description of our capital stock is intended as a summary only and therefore is not a complete description of our capital stock. This description is based upon, and is qualified by reference to, our amended and restated certificate of incorporation (the “Amended Certificate”), our amended and restated bylaws (the “Amended Bylaws”) and applicable provisions of Delaware corporate law. You should read our Amended Certificate and Amended Bylaws, which are filed as exhibits to our Annual Report on Form 10-K, to which this exhibit is also appended.
Our authorized capital stock consists of 40,000,000 shares of common stock, par value $0.00001 per share, and 10,000,000 shares of preferred stock, par value $0.00001 per share.
Our common stock is the only class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
Common Stock
Voting Rights
The holders of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders, including the election of directors, and do not have cumulative voting rights.
Dividends
Subject to limitations under Delaware law and preferences that may be applicable to any then outstanding preferred stock, holders of common stock are entitled to receive ratably those dividends, if any, as may be declared by our board of directors out of legally available funds.
Liquidation
In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of our common stock will be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of or provision for all of our debts and other liabilities, subject to the prior rights of any preferred stock then outstanding.
Rights and Preferences
Holders of common stock have no preemptive or conversion rights or other subscription rights and there are no redemption or sinking funds provisions applicable to the common stock.
Fully Paid and Non-assessable
All outstanding shares of common stock are duly authorized, validly issued, fully paid and non-assessable.
Preferred Stock
Under the terms of our Amended Certificate our board of directors is authorized to direct us to issue shares of preferred stock in one or more series without stockholder approval. Our board of directors has the discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock.

The purpose of authorizing our board of directors to issue preferred stock and determine its rights and preferences is to eliminate delays associated with a stockholder vote on specific issuances. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions, future financings and other corporate purposes, could have the effect of making it more difficult for a third party to acquire, or could discourage a third party from seeking to acquire, a majority of our outstanding voting stock.

Warrants to Purchase Common Stock

Exhibit 4.5

We have issued and outstanding three series of common stock warrants in connection with prior preferred stock financings: (i) Series A Warrants, as amended, to purchase 187,704 shares of common stock, (ii) Series A-1 Warrants, as amended, to purchase 350,000 shares of common stock, and (iii) Series A-2 Warrants, as amended, to purchase 218,225 shares of common stock, (collectively, the “Warrants”). Upon, exercise, the holders of the Warrants can purchase shares of common stock at a price equal to $16.00 per share.
 
Each Warrant expires on the earlier of (a) the third (3rd) anniversary of June 29, 2018, (b) the fifth (5th) anniversary of the applicable Warrant issue date, or (c) the occurrence of a deemed liquidation of the Company. The Warrants allow for cashless exercise only in the event that the underlying shares are not registered or qualified for resale. The Company may force the holders to exercise their Warrant or the Company may redeem each Warrant for a nominal price if, at any time following the one-year anniversary of the issuance of such Warrant, (i) the Company has been listed on a national securities exchange, (ii) the common stock underlying the warrants have been registered or qualified for resale or the holders otherwise have the ability to trade the underlying common shares without restriction following a cash exercise, (iii) the 30-day volume-weighted daily average price of the Company’s common stock exceeds 200% of the exercise price of the Warrants, as equitably adjusted for any stock splits, dividends or transactions having a similar effect, and (iv) the average daily trading volume is at least 200,000 shares of common stock during the 30-day period prior to the forced exercise or redemption.
 
In connection with our IPO, we issued to Roth Capital Partners, LLC, as the representative of the underwriters, a warrant initially exercisable for up to 281,750 shares of common stock. The warrant is exercisable at a per share price equal to $19.20. The warrant is exercisable at any time, and from time to time, in whole or in part, until the fifth anniversary of our IPO, in compliance with FINRA Rule 5110(f)(2)(G)(i). The warrant and the shares of common stock underlying the warrant have been deemed compensation by FINRA and were therefore subject to a 180 day lock-up. Roth Capital Partners, LLC (or its permitted assignees) were not permitted to sell, transfer, assign, pledge or hypothecate the warrant or the securities underlying the warrant, nor engage in any hedging, short sale, derivative, put, or call transaction that would result in the effective economic disposition of the warrant or the underlying securities for the period ending on, and including, December 23, 2018. The exercise price and number of shares of common stock issuable upon exercise of the warrant will be adjusted in certain circumstances, including in the event of a stock dividend, cash dividend or our recapitalization, reorganization, merger or consolidation.
 
Anti-Takeover Effects of Delaware Law and Our Amended Certificate and Amended Bylaws
 
Certain provisions of Delaware law, our Amended Certificate of incorporation and our Amended Bylaws contain provisions that could make the following transactions more difficult: an acquisition of us by means of a tender offer; a proxy contest; or the removal of our incumbent officers and directors. It is possible that these provisions could make it more difficult to accomplish or could deter transactions that stockholders may otherwise consider to be in their best interest or in our best interest, including transactions which provide for payment of a premium over the market price for our shares.
These provisions, summarized below, are intended to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of the increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of discouraging these proposals because negotiation of these proposals could result in an improvement of their terms.

Authorized but Unissued Shares

Our authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval. These additional shares may be utilized for a variety of corporate purposes, including future public offerings to raise additional capital and corporate acquisitions. The existence of authorized but unissued shares of common stock and preferred stock could render more difficult or discourage an attempt to obtain control of a majority of our common stock by means of a proxy contest, tender offer, merger or otherwise.
Appointment and Removal of Directors
Our Amended Certificate and our Amended Bylaws provide that any vacancies resulting from death, resignation, disqualification, removal or other causes and newly created directorships resulting from any increase in the number of directors shall be filled only by the affirmative vote of a majority vote of the directors then in office, unless the board of directors determines such vacancy shall be filled by stockholders. This provision restricting the filling of vacancies will prevent a stockholder from increasing the size of our board of directors and gaining control of our board of directors by filling the resulting vacancies with its own nominees. In addition, Amended Certificate and our Amended Bylaws provide that a member of our board of directors may be removed with or without cause by 

Exhibit 4.5

the vote of the holders of a majority of the voting power of all then-outstanding shares of capital stock of the Company entitled to vote generally at an election of directors.
Advance Notice Procedures
Our Amended Certificate and our Amended Bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to the board of directors. Stockholders at an annual meeting will only be able to consider proposals or nominations specified in the notice of meeting or brought before the meeting by or at the direction of the board of directors or by a stockholder who was a stockholder of record on the record date for the meeting, who is entitled to vote at the meeting and who has given our Secretary timely written notice, in proper form, of the stockholder’s intention to bring that business before the meeting. Although our Amended Bylaws do not give the board of directors the power to approve or disapprove stockholder nominations of candidates or proposals regarding other business to be conducted at a special or annual meeting, our Amended Bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed or may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect its own slate of directors or otherwise attempting to obtain control of the Company.
Delaware Anti-Takeover Statute
We are subject to Section 203 of the Delaware General Corporation Law (“DGCL”), which prohibits persons deemed to be “interested stockholders” from engaging in a “business combination” with a publicly held Delaware corporation for three years following the date these persons become interested stockholders unless the business combination is, or the transaction in which the person became an interested stockholder was, approved in a prescribed manner or another prescribed exception applies. Generally, an “interested stockholder” is a person who, together with affiliates and associates, owns, or within three years prior to the determination of interested stockholder status did own, 15% or more of a corporation’s voting stock. Generally, a “business combination” includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. The existence of this provision may have an anti-takeover effect with respect to transactions not approved in advance by the board of directors. A Delaware corporation may “opt out” of these provisions with an express provision in its original certificate of incorporation or an express provision in its certificate of incorporation or bylaws resulting from a stockholders’ amendment approved by at least a majority of the outstanding voting shares. We have not opted out of these provisions. As a result, mergers or other takeover or change in control attempts of us may be discouraged or prevented.
 
 
Limitation on Director’s Liability
Our Amended Certificate and our Amended Bylaws require us to indemnify our directors to the fullest extent permitted by the DGCL. The DGCL permits a corporation to limit or eliminate a director’s personal liability to the corporation or the holders of its capital stock for breach of duty. This limitation is generally unavailable for acts or omissions by a director which (i) were in bad faith, (ii) were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated or (iii) involved a financial profit or other advantage to which such director was not legally entitled. The DGCL also prohibits limitations on director liability for acts or omissions which result in a violation of a statute prohibiting certain dividend declarations, certain payments to stockholders after dissolution and particular types of loans. We adopted these limitations on our directors’ personal liability to the Company and our stockholders to the maximum extent permitted under Delaware law. The effect of these provisions is to eliminate the rights of our Company and our stockholders (through stockholders’ derivative suits on behalf of our Company) to recover monetary damages against a director for breach of fiduciary duty as a director (including breaches resulting from grossly negligent behavior), except in the situations described above. These provisions do not limit the liability of directors under the federal securities laws of the United States.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC.
National Securities Exchange Listing
Our common stock listed on Nasdaq under the symbol “LOVE.”

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