Document:

Exhibit 10.1

Exhibit 10.1

AGREEMENT AND GENERAL RELEASE

Cortland Bancorp and Cortland Savings and Banking Company (collectively referred to hereafter
as “Employer”), and Lawrence A. Fantauzzi (referred to hereafter as “Employee”), enter into this
Agreement and General Release (referred to hereafter as “Agreement”), as of the date of the last
signature appearing below and agree that in consideration of the mutual promises and provisions of
this Agreement:

1. Last Day of Employment. Employee has previously been employed by Employer as
President and Chief Executive Officer, as well as Vice-President of New Resources Leasing
Corporation, a subsidiary of Cortland Bancorp. Employee has tendered his resignation to Employer,
dated September 4, 2009 and effective October 2, 2009. The Board of Directors, at its meeting on
September 8, 2009, accepted Employee’s resignation. Therefore, Employee understands and
acknowledges that, pursuant to Employee’s resignation tendered to Employer on September 4, 2009,
Employee’s employment with Employer shall cease in all employment capacities including, and without
limitation as officer, director, employee and/or agent of Employer and any and all affiliates and
subsidiaries of Employer including, but not limited to New Resources Leasing Corporation, as of
October 2, 2009. Employee further understands and acknowledges that Employee’s duties and
responsibilities as President and Chief Executive Officer (“CEO”) of Employer ceased as of
September 8, 2009 and Employee hereby tenders Employee’s resignation as a director of Employer as
provided in the attached Exhibit A-1. Employee also hereby waives any and all
participatory rights of Employee in Employer’s Director Emeritus program. Specifically, while
Employee will remain an employee of Employer until October 2, 2009, Employee has been relieved of
all duties and responsibilities as President and CEO in advance of Employee’s October 2, 2009 early
retirement date.

2. Consideration. The parties desire to enter into this Agreement to provide for the
terms of the Employee’s separation, including the termination of Employee’s responsibilities. The
parties further wish to avoid litigation and controversy and fully resolve any and all past,
present and future disputes they may have relating to Employee’s employment with, or separation
from service with the Employer. In consideration for entering into this Agreement and for
complying with the promises made herein, Employer agrees:

a) to pay Employee $5,000.00 per month for twenty-four (24) months,  which shall
be subject to all lawful deductions and withholdings such as income tax, social
security tax, etc. The Employer shall pay the above monthly payment in advance on the
first day of each month, except that the first six monthly payments shall not be paid
until the later of six (6) months after the expiration of the revocation period,
described more fully in Section 3 below, or April 15, 2010 and shall be paid in one lump
sum, as required by Internal Revenue Code Section 409A. These payments will occur only
if the Revocation Period described more fully in Section “3” below passes without
revocation of this Agreement by Employee.

 

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b) To reimburse Employee for Employee’s healthcare premiums for family insurance
coverage substantially similar to the coverage maintained for the Employee and his
family before September 8, 2009, including but not limited to the cost of
family coverage under the provisions of COBRA, up to a maximum of $15,000 per year until
the earlier of Employee’s sixty-fifth (65th) birthday or the date Employee
procures other employment that offers health insurance coverage. Such provision of
healthcare coverage reimbursement is contingent upon Employee’s entry into this
Agreement. Provision of such healthcare coverage reimbursement shall not commence until
after expiration of the Revocation Period described more fully below in paragraph 3,
without revocation of this Agreement by Employee. Such reimbursement will be provided
within thirty (30) days of Employee tendering to Employer proof of Employee’s payment of
said healthcare premiums.

If a Change in Control, as defined in Exhibit D to the Agreement, occurs before the
Employee has fully received the consideration delineated in subsections 2a and 2b above, then the
Employer shall pay the remaining benefits to the Employee in a single lump sum within three (3)
days after the later of (x) the Change in Control or (y) the first day of the seventh month after
the effective date of the Employee’s resignation. The lump-sum payment due the Employee as a
result of a Change in Control shall be an amount equal to the sum of the remaining unpaid balances
corresponding to each particular benefit at the time the Change in Control occurs, including for
purposes of subsection 2a the unpaid balance of the money for the 24 months, for purposes of
subsection 2b the maximum amount of healthcare premium reimbursement amounts remaining for the
maximum years. However, Employee shall reimburse Employer for any excess payment of healthcare
premium reimbursement amounts to Employee under this Paragraph that represents reimbursement of
healthcare premiums for any period of time prior to Employee’s sixty-fifth (65th)
birthday for that period of time whereby the Employee had other employment that offers health
insurance coverage.

The Employer shall cease providing any and all other perquisites to Employee as of Employee’s
last day of employment, October 2, 2009, including, but not limited to, any leased automobile,
credit cards, etc., except as otherwise provided in this Agreement. Please see Section 10 for
further information.

3. No Consideration Absent Execution of this Agreement. Employee understands and
agrees that Employee will not and would not receive the monies and/or benefits specified in Section
“2” above, except for Employee’s execution of this Agreement and the fulfillment by Employee of the
promises of Employee contained herein.

The attached Exhibit A provides those severance benefits that you will receive
regardless of whether or not you execute this Agreement.

Revocation. Employee may revoke this Agreement for a period of seven (7) calendar days
following the day Employee executes this Agreement (“Revocation Period”). Any revocation within
this Revocation Period must be in writing, signed, and submitted to Stephen A. Telego, Sr., Senior
Vice President, Chief of Corporate Administration, Director of Human Resources and state, “I hereby
revoke my acceptance of our Agreement and General Release.” The revocation must be personally
delivered or mailed to Stephen A. Telego, Sr., Senior Vice President, Chief of Corporate
Administration, Director of Human Resources, Cortland Banks, 194 West Main Street, Cortland, Ohio
44410, postmarked within seven (7) calendar days of execution by
Employee of this Agreement. This Agreement shall not become effective or enforceable until the
Revocation Period has expired. If the last day of the Revocation Period is a Saturday, Sunday, or
legal holiday in Ohio, then the Revocation Period shall not expire until the next following day
which is not a Saturday, Sunday, or legal holiday.

 

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4. General Release of Claim. PLEASE READ CAREFULLY. THIS SECTION OF THE AGREEMENT
INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. In consideration of the premises contained in
this Agreement and Employer’s promises and covenants set forth in this Agreement, the sufficiency
of which is hereby acknowledged, Employee for himself, his heirs, executors, administrators,
fiduciaries, successors, and/or assigns, hereby irrevocably and unconditionally releases, waives
and extinguishes, and covenants not to sue or initiate any legal or other proceedings with respect
to any and all rights, liabilities, claims or actions relating in any manner to his employment or
separation from employment by Employer (but, despite the generality of the language anywhere in
this section, this release does not include any rights, liabilities, claims or actions arising
under and regarding the enforcement of terms of this Agreement or with respect to any benefits to
which Employee is entitled without regard to this Agreement as described in Exhibit A to
this Agreement) which he has or may have from the beginning of time to the date of this Agreement
against the Employer, any employee benefit plans maintained by the Employer, Employer’s successors
and assigns, and any of the directors, officers, employees, attorneys, agents, successors, assigns,
or shareholders, parent, affiliates or subsidiaries of the Employer (collectively the “Released
Party ” or “Released Parties”) and the Employee hereby forever releases and discharges all such
Released Parties from any and all actions, causes of action, suits, debts, charges, complaints,
claims, liabilities, obligations, promises, agreements, controversies, damages and expenses
(including attorneys’ fees and other costs actually incurred) of any nature whatsoever, in law or
in equity, which he ever had, now has, or his heirs, executors and administrators may have,
particularly against each or any of the Released Parties arising from the beginning of time to the
end of Employee’s employment with Employer, but without limitation of the above general terms, by
reason of any claims against Employer and the other Released Parties, arising from, or related to,
his employment, including any claims in tort or in contract, or arising from any alleged violation
by Employer of any Federal, State or Local Statutes, Rules, Regulations, Ordinances, or Common Laws
including, but not limited to, the laws contained in Exhibit B to this Agreement and any
alleged violation of:

	 	•	 	The National Labor Relations Act;

	 	•	 	Title VII of the Civil Rights Act;

	 	•	 	Civil Rights Act of 1991;

	 	•	 	Sections 1981 through 1988 of Title 42 of the United States Code;

	 	•	 	The Employee Retirement Income Security Act;

	 	•	 	The Fair Credit Reporting Act;

	 	•	 	The Fair Labor Standards Act;

	 	•	 	The Older Worker’s Benefit Protection Act;

	 	•	 	The Immigration Reform Control Act;

	 	•	 	The Americans with Disabilities Act;

	 	•	 	The Rehabilitation Act;

	 	•	 	The Age Discrimination in Employment Act;

 

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	 	•	 	The Occupational Safety and Health Act;

	 	•	 	The Equal Pay Act;

	 	•	 	The Uniformed Services Employment and Reemployment Rights Act;

	 	•	 	Worker Adjustment and Retraining Notification Act;

	 	•	 	Employee Polygraph Protection Act;

	 	•	 	The Sarbanes-Oxley Act of 2002;

	 	•	 	The Federal False Claims Act;

	 	•	 	any other federal, state or local civil rights law, whistle blower or any
other local, state or federal law, regulation or ordinance including, without
limitation, those laws contained in Exhibit B to the Agreement;

	 	•	 	any public policy, contract (oral, written or implied), tort, constitution
or common law;

	 	•	 	any claims for back pay, front pay, wages, defamation, reinstatement,
wrongful; discharge, breach of the covenant of good faith and fair dealing,
public policy violations, compensatory damages, punitive damages, service
letter benefits, seniority, vacation, sick or personal leave pay, short term or
long term disability benefits, or payment pursuant to any practice, policy,
handbook or manual; or

	 	•	 	any basis for costs, fees, or other expenses including attorneys’ fees.

Employee understands this Release includes all claims related in any manner to Employee’s
employment or the cessation of that employment, except for any claims arising under and regarding
the enforcement of this Agreement or with respect to any benefits to which Employee is entitled
without regard to this Agreement as described in Exhibit A to this Agreement. Employee
further understands that Employee is hereby releasing any known or unknown claim for or alleged
right to discovery of information or documents of Released Parties in regard to and to the extent
of only the released claims, but is not releasing any claim or right to discovery if the
information or documents are relevant to or may lead to the discovery of evidence relevant to a
claim, liability, action, or right that is related to the enforcement of rights arising under this
Agreement. Despite anything in this Agreement to the contrary, this Release by Employee is
expressly conditional on Employee’s actually receiving on time and in full the consideration stated
in Section 2 of this Agreement.

5. Affirmations. Employee affirms that Employee is not a party to, and that
Employee has not filed or caused to be filed, any claim, complaint, charge or action against
Released Parties in any forum or form. Employee further affirms that Employee has been paid and/or
has received all leave (paid or unpaid), compensation, wages, bonuses, commissions, and/or benefits
to which Employee may be entitled and that no other leave (paid or unpaid), compensation, wages,
bonuses, commissions and/or benefits are due to Employee except as provided in this Agreement and
except Employee’s final pay through October 2, 2009 and unused and accrued vacation and personal
time that have not yet been received and are due on or before October 31, 2009, and other benefits
to which Employee is entitled without regard to this Agreement as described in Exhibit A to
this Agreement.

 

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Employee furthermore affirms that Employee has no known workplace injuries or occupational
diseases and has been provided and/or has not been denied any leave requested
under the Family and Medical Leave Act and/or any other federal, state or local leave law.
Employee further affirms Employee has not complained of and is not aware of any fraudulent activity
or any act(s) which would form the basis of a claim of fraudulent or illegal activity of Employer.

6. Confidentiality and Compliance.

Employee agrees that during the course of his employment, Employee was allowed access to
Confidential Information. Confidential Information means all data and information relating to the
business and management of Employer, including proprietary and trade secret technology and
accounting records to which access was obtained by Employee, including work product, production
processes, other proprietary data, business operation, marketing and development operations, and
customer information or lists. Confidential Information would also include any information which
has been disclosed by any third party to Employee and governed by a non-disclosure agreement
entered into between the third party and Employer. Work Product means work product resulting from
or related to work or projects performed or to be performed for Employer or for customers of
Employer, of any type or form in any stage of actual or anticipated research and development.
Production Processes means processes used in the creation, production and manufacturing of the Work
Product, including but not limited to, methods, techniques, specifications, processes, procedures,
programs and designs. Other Proprietary Data means information relating to Employer’s proprietary
rights, including but not limited to, the nature of the proprietary rights, production data,
technical data, technical concepts, test data and test results, simulation results, the status and
details of research and development of products and services, and information regarding acquiring,
protecting, enforcing and licensing proprietary rights (including patents, copy rights and trade
secrets). Business Operations means all internal personnel and financial information, vendor
names, and other vendor information (including vendor characteristics, services and agreements),
purchasing and internal cost information, sales data, employee information, internal services and
operational manuals, and the manner and methods of conducting employer’s business. Marketing and
Development Operations means marketing and development plans, price and costs data, price and fee
amounts, pricing and billing policies, quoting procedures, marketing techniques and methods of
obtaining business, forecasts and forecast assumptions and volumes, and future plans and potential
strategies of employer which had been discussed. Customers means contracts with customers and
their contents, data provided by customers and the type, quantity and specifications of products
and services purchased, leased, licensed or received by customers of Employer. Subject to
Employee’s rights under Section 9 below, Employee acknowledges Employee’s singular responsibility
to maintain the confidential nature of the Confidential Information regarding such matters and
agrees not to divulge to any party or use for Employee’s personal benefit (except to the extent
required by law or permitted by this Agreement), any non-public information gained during and in
the course of Employee’s employment with Employer.

Employee affirms that Employee is not aware of any undisclosed or unresolved corporate
compliance issues arising under any federal, state or local law or regulation. Employee also
affirms that Employee has not and will not alter, destroy, remove, or inappropriately limit access
by the Employer to any of the Employer’s records, documents or electronically stored data.
Employer agrees to cooperate with Employee’s requests and Employee hereby releases
Employer to provide information to prospective Employers regarding Employee’s years of
employment, a reasonable description of Employee’s work responsibilities and experience.

 

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7. Non-Disparagement. Employee agrees not to engage in any activities or statements
that may tend to defame, disparage or demean Employer, Employer’s affiliates, directors, officers,
agents, employees or representatives in any manner whatsoever, or seek or cause others to engage in
such activities or statements.

8. Cooperation. Subject to Employee’s other personal and professional obligations and
on reasonable notice and at reasonable times, Employee will cooperate with Employer and its counsel
in connection with any investigation, administrative or regulatory proceeding or litigation
relating to any matter in which Employee was involved or of which Employee has knowledge as a
result of Employee’s employment with Employer and/or any Released Party or Released Parties. For a
period of two (2) years after the effective date of Employee’s resignation, Employee also agrees
that if requested, Employee will from time to time consult by telephone or through correspondence
with the staff of Employer with respect to projects on which Employee worked, including any
projects to which Employee was assigned that are incomplete. The Employer shall pay any of
Employee’s out-of-pocket expenses incurred in responding to the Employer’s specific requests.

9. Non-Solicitation. Employee acknowledges that, pursuant to Section 6 above,
Employee has had access to the Employer’s confidential and trade secret information. In
consideration of the foregoing, Employee hereby covenants and agrees that Employee shall not:

	 	(i)	 	Whether for Employee’s own account or for the account
of any other person or entity, at any time for a period of two (2) years
after the effective date of Employee’s resignation, solicit the banking
business of any present customer of the Employer with whom Employee had
contact while employed at the Employer. It is understood and agreed that
“present customer” is defined to mean any person or entity with whom the
Employer had “an ongoing business relationship” at the time of termination
of Employee’s employment with the Employer. And “ongoing business
relationship” is generally understood and agreed to mean: (a) services or
goods were provided by the Employer to the entity or person during the
employment of Employee by the Employer; (b) services or goods had been
contracted for or ordered by the entity or person during the employment of
Employee by the Employer; or (c) negotiations were in progress between the
entity or person and the Employer for the provision of goods or services by
the Employer to the entity or person at the time of the termination of
employment of Employee; and

 

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	 	(ii)	 	Whether for Employee’s own account or for the account
of any other person or entity at any time for a period of two (2) years
after the effective date of Employee’s resignation, solicit, employ or
otherwise engage as an employee, agent, independent contractor or
otherwise, any person or entity who is or was an employee, agent, or independent
contractor of the Employer during Employee’s employment, or in any
manner induce or attempt to induce any employee, agent, or independent
contractor of the Employer to terminate his, her, or its employment,
relationship or contract with the Employer.

It is understood by and between the parties hereto that the foregoing covenants by Employee
set forth in this Section 9 are essential elements of this Agreement and that, but for the
agreement of Employee to comply with such covenants, the Employer would not have entered into this
Agreement. The Employer and Employee have independently consulted their respective counsel and
have been advised in all respects concerning the reasonableness and propriety of such covenants,
with specific regard to the nature of the businesses conducted by the Employer.

10. Return of Property. Employee understands and acknowledges that all property
belonging to Employer, including, but not limited to, that described on Exhibit C attached
hereto, is to be returned immediately by Employee. If Employee executes this Agreement, such
return shall occur no later than seven (7) calendar days from the date of this Agreement. With the
return of Bank’s materials, Employee shall submit a letter to Stephen A. Telego, Sr., affirming, to
the best of Employee’s knowledge, that Employee has returned all property and copies and has not
intentionally retained any property belonging to Employer.

11. Governing Law and Interpretation. This Agreement shall be governed and conformed
in accordance with the laws of the State of Ohio without regard to its conflict of laws provision.
In the event Employee or Employer breaches any provision of this Agreement, Employee and Employer
affirm that either may institute an action against the other to specifically enforce any term or
terms of this Agreement, in addition to any other legal or equitable relief permitted by law. In
the event that any provision of this Agreement is declared illegal or unenforceable by a court of
competent jurisdiction and cannot be modified to be enforceable, excluding the general release
language and any confidentiality, non-disclosure, non-solicitation, invention, or assignment of
proprietary rights agreement(s) signed by Employee, such provision shall immediately become null
and void, leaving the remainder of this Agreement in full force and effect. Moreover, if any such
provision is determined to be invalid, illegal or unenforceable and can be made valid, legal or
enforceable by modification thereof, then the party for whose benefit the provision exists may make
such modification as necessary to make the provision valid, legal and enforceable.

12. Nonadmission of Wrongdoing. Employee agrees that neither this Agreement nor the
furnishing of the consideration for this Agreement shall be deemed or construed at anytime for any
purpose as an admission by Employer, Employer’s agents, employees, directors, officers or attorneys
of any liability or unlawful conduct of any kind. Furthermore, this Agreement does not constitute
an acknowledgement of the validity of any claim, charge or complaint which, but for this Agreement,
the Employee may attempt to assert. It is expressly understood that all such claims are in all
respects denied by the Employer and waived and released by the Employee. Employer agrees that
neither this Agreement nor the accepting of the consideration for this Agreement shall be deemed or
construed at anytime for any purpose as an admission by Employee of any liability or unlawful
conduct of any kind.

 

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13. Amendment. This Agreement may not be modified, altered or changed except upon
express written consent of both parties wherein specific reference is made to this Agreement.

14. Entire Agreement. This Agreement sets forth the entire agreement between the
Employee and Released Parties hereto, and fully supersedes any prior or contemporaneous agreements
or understandings between Employee and Released Parties; provided, however, that this Agreement
does not supersede or affect any confidentiality, non-disclosure, non-compete, invention,
assignment of proprietary rights, or non-solicitation agreement(s) signed by Employee and further
provided, however, that this Agreement does not supersede or affect any benefits or benefit plans
or agreements to which Employee is entitled without regard to this Agreement as described in
Exhibit A, including but not limited to the Employee’s retirement benefit and post
retirement, split dollar life insurance. The obligations of such agreements remain in full force
and effect and Employee and Released Parties expressly acknowledge their respective intent to
adhere to the promises contained in those agreements. Employee and the Released Parties each also
acknowledges that the other has not relied on any representation, promises, or agreements of any
kind made in connection with the decision to sign this Agreement, except for those set forth in
this Agreement. At any time after the execution of this Agreement, and for no additional
consideration or payment, Employee and Employer each agrees to execute any and all documents and
other instruments that may be necessary to affect the terms and conditions of this Agreement. This
Agreement shall be binding upon the heirs, executors, administrators, succesors or assigns of the
Employee and upon the parent, affiliates, subsidiaries, successors and assigns of the Employer.
The Employer and the Employee acknowledge that they have each read the foregoing in its entirety,
fully understand the same, and are in full accord with the terms of this Agreement.

15. Voluntary Entry: Employee represents and certifies that he has carefully read and
fully understands all of the provisions and affects of this Agreement, and has been advised by
Employer to thoroughly discuss all aspects of this Agreement with Employee’s private attorney, that
Employee is voluntarily entering into this Agreement and that neither Employer nor its employees,
officers, agents, representatives or attorneys have made any promises, representations or
statements concerning the terms or affects of this Agreement other than those contained herein.
Employee further represents and certifies that Employee bears sole responsibility for compliance
with Internal Revenue Code Section 409A, including the required six (6) month delay for separation
from service benefits payable to “so called specified employees”. It is the Employee’s obligation
to make sure that separation pay complies with IRC Section 409A.

Employee agrees and acknowledges that Employee has had an opportunity to be represented by
counsel of Employee’s choice and counsel has had an opportunity to review this Agreement, if
counsel has been chosen, and that Employee is executing this Agreement of Employee’s own free will
without any promises or representations other than those contained herein. Employee acknowledges
and understands that this Agreement shall not become effective and binding until after the
execution of this Agreement within the Review Period, as provided more fully below, and the
expiration of the Revocation Period without revocation of this
Agreement by Employee, and the delivery to the Employer of the executed Agreement. Employee
specifically acknowledges that Employee has not relied upon the Employer’s legal counsel to
evaluate this Agreement and acknowledges that neither the Employer’s legal counsel nor any of the
Employer’s representatives made any representations as to the terms of this Agreement.

 

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EMPLOYEE IS ADVISED THAT EMPLOYEE HAS NO LESS THAN TWENTY ONE (21) CALENDAR DAYS TO CONSIDER
THIS AGREEMENT AND GENERAL RELEASE (“REVIEW PERIOD”) AND IS HEREBY ADVISED TO CONSULT WITH AN
ATTORNEY PRIOR TO EXECUTION OF THIS AGREEMENT AND GENERAL RELEASE.

EMPLOYEE IS ADVISED THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE, MADE TO THIS AGREEMENT AND
GENERAL RELEASE DO NOT RESTART OR AFFECT IN ANY MANNER THE ORIGINAL TWENTY ONE (21) CALENDAR DAY
REVIEW PERIOD.

HAVING ELECTED TO EXECUTE THIS AGREEMENT AND GENERAL RELEASE, TO FULFILL THE PROMISES SET
FORTH HEREIN, AND TO RECEIVE THEREBY THE SUMS AND BENEFITS SET FORTH IN SECTION “2” ABOVE, EMPLOYEE
FREELY AND KNOWINGLY, AND AFTER DUE CONSIDERATION, ENTERS INTO THIS AGREEMENT AND GENERAL RELEASE
INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS EMPLOYEE HAS OR MIGHT HAVE AGAINST RELEASED
PARTIES AS OF THE DATE OF THE EXECUTION OF THIS AGREEMENT.

[The remainder of this page is intentionally left blank]

 

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The parties hereto knowingly and voluntarily executed this Agreement and General Release as of
the date set forth below:

	 	 	 	 	 
	WITNESSES:
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	Lawrence A. Fantauzzi (Employee)
	 
	 	 	 	 
	 	 	 
	 	 	Date
	 
	 	 	 	 
	 	 	ON BEHALF OF EMPLOYER

(AS DEFINED HEREIN)
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Stephen A. Telego, Sr.
	 	 	Senior Vice President
	 	 	Chief of Corporate Administration
	 
	 	 	 	 
	 	 	Director of Human Resources
	 
	 	 	 	 
	 

	 	Date:	 	 
	 

	 	 	 	 

 

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EXHIBIT A

Termination Benefits to Which the Employee is Entitled, Whether or Not the

Employee Executes the Agreement and General Release

	 	1.	 	Pay through October 2, 2009 will be paid to the Employee pursuant to Employer’s
regular payroll schedule.

	 	2.	 	Any unused and accrued vacation and personal time, to be paid in a lump sum
payment, along with the Employee’s final paycheck through October 2, 2009, in the
approximate amount of $5,250, less all-applicable withholdings.

	 	3.	 	The employer provided group term life and accidental death and dismemberment
insurance coverage and short-term disability coverage, if any, will cease October 31,
2009, except for the insurance described in item 9 below in this Exhibit A

	 	4.	 	Any applicable distribution from your 401K account.

	 	5.	 	All applicable payroll deductions will apply.

	 	6.	 	COBRA coverage if eligible.

	 	7.	 	Employee may keep Employee’s free employee checking account open until December
31, 2009.

	 	8.	 	Participation in Employer’s early retirement program pursuant to “The Cortland
Savings & Banking Company Third Amended Salary Continuation Agreement” by and between
Employee and the Bank.

	 	9.	 	Post-retirement, split dollar life insurance benefit payable to Employee’s
beneficiaries under the Employer’s Group Term Carve Out Plan, in the amount equal to
Employee’s most recent salary at the time of retirement, which is $195,000.00.

 

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EXHIBIT B

OHIO

The following statutes, rules and guidelines are incorporated into and made part of the
General Release of Claims provision, Section 4 of the Agreement and General Release to which this
listing is attached as Exhibit B:

	 	•	 	Ohio Fair Employment Practice Law;

	 	•	 	Ohio Whistleblower Protection Law;

	 	•	 	Ohio Statutory Provisions Regarding Retaliation/Discrimination for Filing Worker’s
Compensation Claim;

	 	•	 	Ohio Equal Pay Law;

	 	•	 	Ohio State Wage Payment and Work Hour Laws;

	 	•	 	The Ohio Commission Policy Statement on AIDS;

	 	•	 	The Ohio Occupational Safety and Health Laws;

	 	•	 	The Ohio Military Re-Employment Rights and Reinstatement Laws;

	 	•	 	The Ohio statutes regarding Job Reference Immunity; Access to Medical Records;
Pre-Employment Inquiries; Political Activities of Employees; Voting Leave; Arrest Records;
Volunteer Firefighter/EMA Leave; Jury Service; Witness Service; Employee Attendance at
Legal Proceedings; Drug/Alcohol Testing of CMV Drivers; Driving Records; Criminal
Background Checks; and, Retaliation for Refusal of Life Insurance.

 

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EXHIBIT A-1

RESIGNATION

In consideration for the benefits received by him under the Agreement to which this Exhibit A-1 is
attached, the undersigned, effective as of September 8, 2009, hereby resigns all positions he may
hold as an officer or director with Cortland Savings & Banking Company, Cortland Bancorp and any
and all subsidiaries and affiliates thereof. The undersigned understands, however, that the
undersigned otherwise remained an Employee of Cortland Savings and Banking Company and Cortland
Bancorp until his early retirement date of October 2, 2009.

	 	 	 
	 

	 	 
	 

	 	Lawrence A. Fantauzzi

 

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EXHIBIT C

	 	1.	 	Return of keys to and the leased 2008 Cadillac Escalade (Onyx in color) provided to
Employee, along with any and all related manuals and accessories

	 	2.	 	The Sunoco gas credit card

3. The ELAN Visa credit card

	 	4.	 	The Employer shall transfer Employee’s current membership in the Trumbull Country Club
to an individual of Employer’s choosing, effective November 1, 2009.

	 	5.	 	Keys and key cards to any and all Bank facilities

	 	6.	 	The Cellular telephone provided to Employee

	 	7.	 	Any and all Employer documents regarding Employer’s business, as well as any written
files, electronic files, records, materials, supplies, customer lists, customer information
or confidential documents in Employee’s possession

 

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EXHIBIT D

“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:

(a) Change in Ownership: a change in ownership of Cortland Bancorp occurs on the date any one
person or group accumulates ownership of Cortland Bancorp stock constituting more then 50% of the
total fair market value or total voting power of Cortland Bancorp’s stock, or

(b) Change in ownership of a substantial portion of assets: a change in ownership of a
substantial portion of Cortland Bancorp’s assets occurs if in a 12 month period any one person or
more than one person acting as a group acquires from Cortland Bancorp assets having a total gross
fair market value equal to or exceeding 40% of the total gross fair market value of all of Cortland
Bancorp’s assets immediately before the acquisition or acquisitions. For the purpose, gross fair
market value means the value of Cortland Bancorp’s assets, or the value of the assets being
disposed of, determined without regard to any liabilities associated with the assets.

 

-15-Exhibit 10.1

EXHIBIT 10.1

PROMISSORY NOTE

(Commercial)

DATE AND PARTIES. The date of this Promissory Note (Note) is October 16, 2009. The parties
and their addresses are:

LENDER:

                                                                                

                                                                                

                                                                                

                                                                                

BORROWER:

VIEWPOINT FINANCIAL GROUP

1301 W. 15th St., Suite 400

Plano, Texas 75075

Attention: President/CEO

1. DEFINITIONS. As used in this Note, the terms below have the following meanings:

A. Pronouns. The pronouns “I,” “me,” and “my” refer to Borrower. “You” and “Your” refer to
the Lender.

B. Note. Note refers to this document, and any extensions, renewals, modifications and
substitutions of this Note.

C. Loan. Loan refers to this transaction generally.

D. Loan Documents. Loan Documents refer to all the documents executed as a part of or in
connection with the Loan.

E. Percent. Rates and rate change limitations are expressed as annualized percentages.

2. PROMISE TO PAY. For value received, Borrower promises to pay you or your order, at your
address, or at such other location as you may designate, amounts advanced from time to time under
the terms of this Note up to the maximum total principal balance of $                     (Principal),
plus interest from the date of disbursement, on the unpaid outstanding Principal balance until
this Note is paid in full and you have no further obligations to make advances to Borrower under
the Loan.

All advances made will be made subject to all other terms and conditions of the Loan.

3. INTEREST. Interest will accrue on the unpaid Principal balance of this Note at the rate equal
to the greater of (i) six percent (6.00%), or (ii) the 2-Year Jumbo (CDs National Average), as
defined below, plus two percent (2.00%), adjusted quarterly as described below, provided that in
no event shall the Note rate be greater than nine percent (9.00%) (Interest Rate). The initial
Interest Rate on this Note is six percent (6.00%), and shall be recalculated as provided above
effective on the first calendar day of each calendar quarter during the term of this Note.

 

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A. Maximum Interest Amount. Any amount assessed or collected as interest under the terms of
this Note will be limited to the maximum lawful amount of interest allowed by state or federal
law, whichever is greater. Amounts collected in excess of the maximum lawful amount will be
applied first to the unpaid Principal balance. Any remainder will be refunded to Borrower.
The maximum interest rate producing the maximum lawful amount will be the weekly ceiling rate
announced by the Credit Commissioner from time to time hereafter.

B. Statutory Authority. The amount assessed or collected on this Note is authorized by the
Texas usury laws under Tex. Fin. Code, Ch. 303.

C. Accrual. Interest accrues using an Actual/365 days counting method.

D. “2-Year Jumbo (CDs National Average)”. The term “2-Year Jumbo (CDs National Average)” shall
be defined as the “Current” national average rate for 2-Year Jumbo CDs posted on the Key Rates
page (under Market Data-Rates and Bonds) of Bloomberg.com as of close of business on the last
Business Day of each calendar quarter during the term of this Note. Without notice to the
Borrower or any other person, the 2-Year Jumbo (CDs National Average) may change pursuant to
the preceding sentence. The 2-Year Jumbo (CDs National Average) is a reference rate and does
not necessarily represent the highest or best rate actually available to any customer. If the
2-Year Jumbo (CDs National Average) is unavailable at the time of any rate recalculation under
this Note, then a similar, publicly available, national average rate for two-year, jumbo
certificates of deposit will be mutually agreed upon between the parties as the new reference
rate. “Business Day” shall mean a day other than a Saturday, Sunday or legal holiday for
commercial banks under the laws of the State of Texas.

4. PAYMENT. Borrower agrees to pay this Note in quarterly installments of accrued interest
beginning January 15, 2010, and then on the same day in each 3rd month thereafter; provided,
however, that Borrower may be required to prepay all or a portion of the Principal balance under
Sections 5A or 5B below. Borrower agrees to pay the entire unpaid Principal and any accrued but
unpaid interest on October 15, 2014.

Payments will be rounded up to the nearest $.01. With the final payment Borrower also agrees to
pay any additional fees or charges owing. Payments scheduled to be paid on the 29th, 30th or 31st
day of a month that contains no such day will, instead, be made on the last day of such month.

Each payment Borrower makes on this Note will be applied first to interest that is due, then to
any charges that Borrower owes other than principal and interest, and finally to principal that is
due. If you and Borrower agree to a different application of payments, we will describe our
agreement on this Note.

5. PREPAYMENT. Borrower may not prepay all or any part of the Principal for the first two (2)
years after the date hereof. Thereafter, Borrower may prepay this Loan in full or in part at any
time without fee or penalty. Any partial prepayment will not excuse any later scheduled payments
until Borrower pays in full. In addition, notwithstanding anything contained in this Note to the
contrary:

A. Lender Call Option. You may require Borrower, after at least 180 days advance written
notice, to prepay up to 100% of the Principal balance of the Note on the second and/or
fourth anniversaries of this Note (or the first business day thereafter if the anniversary
falls on a bank holiday or weekend), and

B. Lender Call Option for Stock Purchase. Upon at least 90 days notice, you may one time
during the term of this Note require Borrower to prepay up to $2,000,000 (or the total
Principal balance, if less than $2,000,000) of the Principal balance of this Note, provided
that (i) such prepayment request is solely for the funds required to fulfill your order for
the purchase of stock as permitted in Section 7 below, and (ii) the aggregate amount of
Lender’s prepayment request under this Note plus all similar stock offering-related prepayment requests made by Lender
or Lender’s affiliates or family members (or their successors or assigns) under other loans
made by such parties to Borrower shall not exceed $2,000,000.

 

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6. LOAN PURPOSE. The purpose of this Loan is to secure operating capital.

7. PURCHASE OF STOCK WITH LOAN REPAYMENT PROCEEDS. To the extent permitted by the terms of the
offering and the applicable laws, rules and regulations of The Office of Thrift Supervision, the
Securities and Exchange Commission or any other securities or banking regulatory agency, you may
use the amount of any proceeds from a repayment by me, prior to the closing of the offering, of
all or a portion of the principal balance of this Loan to purchase shares of common stock
available for sale as part of a “second step” conversion by ViewPoint MHC and ViewPoint Bank. You
acknowledge that such an offering includes a subscription offering and a community offering in
which certain persons, including members of ViewPoint MHC, have prioritized subscription rights
and that there are limitations on how many shares a person, individually as well as aggregated
with the person’s affiliates, may purchase.

8. WAIVERS AND CONSENT. To the extent not prohibited by law, Borrower waives protest, presentment
for payment, demand, notice of acceleration, notice of intent to accelerate and notice of
dishonor.

A. Additional Waivers By Borrower. In addition, Borrower, and any party to this Note and Loan,
to the extent permitted by law, consent to certain actions you may take, and generally waive
defenses that may be available based on these actions or based on the status of a party to this
Note.

(1) You may renew or extend payments on this Note, regardless of the number of such
renewals or extensions.

(2) You may release any Borrower, endorser, guarantor, surety, accommodation maker or any
other co-signer.

(3) You, or any institution participating in this Note, may invoke your right of set-off.

(4) You may enter into any sales, repurchases or participations of this Note to any person
in any amounts and Borrower waives notice of such sales, repurchases or participations.

(5) Borrower agrees that any of us signing this Note as a Borrower is authorized to modify
the terms of this Note or any instrument securing, guarantying or relating to this Note.

(6) Borrower agrees that you may inform any party who guarantees this Loan of any Loan
accommodations, renewals, extensions, modifications, substitutions or future advances.

B. No Waiver By Lender. Your course of dealing, or your forbearance from, or delay in, the
exercise of any of your rights, remedies, privileges or right to insist upon my strict
performance of any provisions contained in this Note, or any other Loan Document, shall not be
construed as a waiver by you, unless any such waiver is in writing and is signed by you.

9. APPLICABLE LAW. This Note is governed by the laws of Texas. In the event of a dispute, the
exclusive forum, venue and place of jurisdiction will be in Texas, unless otherwise required by
law.

10. SUCCESSORS AND ASSIGNS. Extending the Loan or new obligations under the Loan, will not
affect Borrower’s duty under the Loan and Borrower will still be obligated to pay the Loan. This
Note shall inure to the benefit of and be enforceable by you and your successors and assigns and
shall be binding upon and enforceable against Borrower and Borrower’s personal representatives,
successors, heirs and assigns.

 

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11. INTERPRETATION. Whenever used, the singular includes the plural and the plural includes the
singular. The section headings are for convenience only and are not to be used to interpret or
define the terms of this Note.

12. NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS. Unless otherwise required by law, any
notice will be given by delivering it or mailing it by hand delivery or certified mail, return
receipt requested, to the appropriate party’s address listed in the DATE AND PARTIES section, or
to any other address designated in writing. Borrower will inform you in writing of any change in
Borrower’s address or other pertinent information. Borrower agrees to sign, deliver, and file any
additional documents or certifications that you may consider necessary to perfect, continue, and
preserve my obligations under this Loan. Time is of the essence.

13. ERRORS AND OMISSIONS. Borrower agrees, if requested by you, to fully cooperate in the
correction, if necessary, in the reasonable discretion of you of any and all loan closing
documents so that all documents accurately describe the loan between you and Borrower. Borrower
agrees to assume all costs including by way of illustration and not limitation, actual expenses,
legal fees and marketing losses for failing to reasonably comply with your requests within thirty
(30) days.

14. BORROWED FUNDS NOT INSURED. The amounts owed under this Note are not deposits or savings
accounts and are not insured or guaranteed by (i) the Federal Deposit Insurance Corporation or any
other governmental agency or (ii) ViewPoint Bank.

15. AGREEMENT TO ARBITRATE. You or Borrower may submit to binding arbitration any dispute, claim
or other matter in question between or among you and Borrower that arises out of or relates to
this Transaction (Dispute), except as otherwise indicated in this section or as you and Borrower
agree to in writing. For purposes of this section, this Transaction includes this Note and the
other Loan Documents, and proposed loans or extensions of credit that relate to this Note. You or
Borrower will not arbitrate any Dispute within any “core proceedings” under the United States
bankruptcy laws.

You and Borrower must consent to arbitrate any Dispute concerning a debt secured by real estate at
the time of the proposed arbitration.

You or Borrower may, whether or not any arbitration has begun, pursue any self-help or similar
remedies, including exercising other rights under the law; or seek attachment, garnishment,
receivership or other provisional remedies from a court having jurisdiction to preserve the rights
of or to prevent irreparable injury to you or Borrower.

The arbitrator will determine whether a Dispute is arbitrable. A single arbitrator will resolve
any Dispute, whether individual or joint in nature, or whether based on contract, tort, or any
other matter at law or in equity. The arbitrator may consolidate any Dispute with any related
disputes, claims or other matters in question not arising out of this transaction. Any court
having jurisdiction may enter a judgment or decree on the arbitrator’s award. The judgment or
decree will be enforced as any other judgment or decree.

You and Borrower acknowledge that the agreements, transactions or the relationships which result
from the agreements or transactions between and among you and me involve interstate commerce. The
United States Arbitration Act will govern the interpretation and enforcement of this section.

The American Arbitration Association’s Commercial Arbitration Rules, in effect on the date of this
Note, will govern the selection of the arbitrator and the arbitration process, unless otherwise
agreed to in this Note or another writing.

 

4

 

16. WAIVER OF TRIAL FOR ARBITRATION. You and Borrower understand that the parties have the right
or opportunity to litigate any Dispute through a trial by judge or jury, but that the parties
prefer to resolve Disputes through arbitration instead of litigation. If any Dispute is
arbitrated, you and Borrower voluntarily and knowingly waive the right to have a trial by jury or
judge during the arbitration.

17. AMENDMENT, INTEGRATION AND SEVERABILITY. This Note may not be amended or modified by oral
agreement. No amendment or modification of this Note is effective unless made in writing and
executed by you and Borrower. This Note and the other Loan Documents are the complete and final
expression of the agreement. If any provision of this Note is unenforceable, then the
unenforceable provision will be severed and the remaining provisions will still be enforceable.

18. SIGNATURES. By signing, Borrower agrees to the terms contained in this Note. Borrower also
acknowledges receipt of a copy of this Note.

BORROWER:

ViewPoint Financial Group

By                                                            

Garold R. Base, President/CEO

 

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