SEVERANCE AGREEMENT AND
FULL AND FINAL WAIVER, RELEASE AND DISMISSAL OF ALL CLAIMS

This SEVERANCE AGREEMENT AND FULL AND FINAL WAIVER, RELEASE AND DISMISSAL OF ALL
CLAIMS ("Agreement") is made and entered into this 3rd day of February, 2015 by
and between Thomas J. Linneman (“Employee”), for himself and for his heirs,
assigns and personal representatives, and Cheviot Savings Bank (“Employer”), an
Ohio-chartered stock savings and loan association with its principal office
located at 3723 Glenmore Avenue, Cheviot, Ohio, its officers, directors, holding
company, employees, agents, successors and assigns.

WHEREAS, Employee is employed as President and Chief Executive Officer of
Employer pursuant to an Amended and Restated Employment Agreement (“Employment
Agreement”) entered into on February 18, 2014;

WHEREAS, Employee also is the Chairman of the Board of Directors of Employer;

WHEREAS, Employee wishes to resign from his employment with Employer and from
his position on the Board of Directors of Employer;

WHEREAS, Employee wishes to retire from his employment with Employer and from
his position on the Board of Directors; and

WHEREAS, the parties now wish to resolve any and all employment and severance
matters at this time.

NOW, THEREFORE, in consideration of the mutual promises, covenants and financial
payments described herein, the fairness and adequacy thereof being stipulated by
the parties, Employer and Employee agree and covenant as follows:

1.           Resignation.  Employee hereby resigns from his employment with
Employer, and from his position on the Board of Directors of Employer, as of
February 6, 2015 (“Effective Date of Resignation”).  Further, Employee hereby
resigns as of the Effective Date of Resignation from any and all positions
Employee may hold with respect to Employer’s holding company, Cheviot Financial
Corp., and the Board of Directors of Cheviot Financial Corp.

2.           Termination of Employment Agreement.  The parties agree that
Employee’s Employment Agreement will terminate on the Effective Date of
Resignation.  Only those provisions of the Employment Agreement specifically
mentioned herein as surviving the termination of the Employment Agreement shall
so survive.  The parties agree that the termination of the Employment Agreement
is without penalty or forfeiture to either party.  The parties further agree
that this Agreement, and not the Employment Agreement, shall govern all aspects
of Employee’s resignation from Employer, and all related severance matters.  To
the extent any provision of this Agreement may conflict with any provision of
the Employment Agreement, this Agreement shall be the controlling document.

 
 

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3.           No Reelection to Board of Directors.  Employee hereby agrees that
he will not seek reelection to, and that he will not otherwise serve on, the
Board of Directors of either Employer or Cheviot Financial Corp. at any time
after the Effective Date of Resignation.    

4.           Return of Property.  Employee agrees to return to Employer any and
all property belonging to Employer, including but not limited to office keys,
documents, electronic information, financial information, and any records of any
kind, in any format, on the Effective Date of Resignation.  Employee understands
that no payments will be made to him under this Agreement until all such
property is returned.

5.           Appeal.   Employee, in further consideration of the benefits
hereinafter described, agrees to waive any right to appeal any of Employer’s
decisions relating to his employment or his Employment Agreement through any
employee appeal procedures.  Employee specifically agrees to waive any rights
under the Employment Agreement to dispute and/or arbitrate any decisions by
Employer relating to his employment or to his Employment Agreement.

6.           Consideration.  In further consideration of Employee’s resignation
and full and final waiver, release and dismissal of all claims, and his other
agreements and promises herein, Employer promises and agrees to provide the
following severance consideration:

i)  Payment, in lieu of notice, of Employee’s annual gross salary of $280,488
for two (2) years, for a total gross payment of $560,976; and payment, in lieu
of notice, of the normal gross wages Employee would have earned from the
Effective Date of Resignation up to and through the anniversary date of the
Employment Agreement, which is February 18, 2015, for a total gross payment of
$8,630.40.  Both of the foregoing payments will be less deductions for
withholding required by law and less other deductions authorized by
Employee.  Both of the foregoing payments will be made to Employee in a lump sum
cash payment on the thirtieth (30th) day following the Effective Date of
Resignation.

ii)  Payment, in lieu of notice, in an amount equal to two (2) times the amount
of $31,940, which amount is equal to the highest bonus Employer previously paid
Employee in the prior three (3) years, for a total gross payment of $63,880,
less deductions for withholding required by law and less other deductions
authorized by Employee.  Said payment will be made to Employee in a lump sum
cash payment on the thirtieth (30th) day following the Effective Date of
Resignation.

iii)  Payment, in lieu of notice, in the gross amount of $15,949.24 , which
amount is reasonably estimated to be equal to the present value of the
contributions that would have been made on Employee’s behalf under Employer’s
ESOP plan if Employee had continued working for a period of two (2) years
following the Effective Date of Resignation.  Said payment will be less
deductions for withholding required by law and less other deductions authorized
by Employee.  Said payment will be made to Employee in a lump sum cash payment
within thirty (30) days of the Effective Date of Resignation.

iv)  Payment, in lieu of notice, in the gross amount of $35,924.74, which amount
is reasonably estimated to be equal to the present value of the contributions
that would have been made on Employee’s behalf under Employer’s 401(k) plan if
Employee had continued working for a period of two (2) years following the
Effective Date of Resignation.  Said payment will be less deductions for
withholding required by law and less other deductions authorized by
Employee.  Said payment will be made to Employee in a lump sum cash payment
within thirty (30) days of the Effective Date of Resignation.

 
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v)  For a period of eighteen (18) months, commencing on March 1, 2015 and ending
on August 31, 2016, Employer shall pay Employee’s COBRA premiums on behalf of
Employee for Employee’s medical and dental coverage. Such medical and dental
coverage shall be substantially comparable, as reasonably available, to the
coverage maintained by Employer for Employee prior to the Effective Date of
Resignation, except to the extent such coverage may be changed in its
application to all employees of Employer.

vi)  Payment, in lieu of notice, in the gross amount of $37,780.83, which amount
is equal to the value of the nontaxable medical coverage and dental coverage
which Employer would have provided to Employee for 27 months, at a gross cost to
Employer of $1,399.29 per month, which amount of months is the same amount of
months in between the expiration of Employee’s eligibility for COBRA and the age
at which Employee becomes eligible for Medicare. Said payment will be less
deductions for withholding required by law and less other deductions authorized
by Employee.  Said payment will be made to Employee in a lump sum cash payment
within thirty (30) days of the Effective Date of Resignation.  Further, Employer
will pay to Employee, at the same time and in the same manner as the foregoing
payment, the gross amount of $30,415.61, which amount is equal to the amount
Employee will be taxed on the payment described above in this subsection (vi).

vii)  Payment, in lieu of notice, in the gross amount of $2,829.60, which amount
is equal to the annual life insurance premiums which Employer would have paid on
behalf of Employee if Employee had continued working for a period of two (2)
years following the Effective Date of Resignation.  Further, Employer will pay
to Employee, at the same time and in the same manner as the foregoing payment,
the gross amount of $2,277.98, which amount is equal to the amount Employee will
be taxed on the payment described above in this subsection (vii).

viii)  Payment, in lieu of notice, in the gross amount of $6,666, which amount
is equal to the fees Employee would have received for his service on the Board
of Directors of Employer up to and through April 23, 2015.  Said payment will be
made to Employee in a lump sum cash payment on the thirtieth (30th) day
following the Effective Date of Resignation.  Consistent with applicable law, no
deductions will be withheld from said payment, and Employee will be issued a
Form 1099 for said payment.

ix)  With respect to Employee’s rights under the Amended and Restated Directors
Deferred Compensation Plan, as well as any stock agreement under which Employee
holds stock options or has other stock rights, Employer agrees to honor the
terms of those agreements and any associated plan documents as they are written,
and those agreements and any associated plan documents shall not be prejudiced
or otherwise affected by this Agreement.

 
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7.           Satisfaction of Claims. Employee acknowledges and agrees that such
amounts agreed to be paid to him and benefits agreed to be furnished to him
herein fully and completely satisfy all claims for monies or benefits owed to
him by Employer.  Employee further acknowledges that the consideration provided
in this agreement by Employer for release of all claims, including release of
Age Discrimination and Employment Act (“ADEA”) claims, is above and beyond that
to which he is already entitled.  Employee further acknowledges that he shall
not be entitled to accrue any further benefits (except as expressly provided in
this Agreement) after the Effective Date of Resignation.
 
8.           Release from Employee to Employer.  As a material inducement to
Employer to enter into this Agreement,  Employee for himself and for his
personal representatives, heirs and assigns fully, completely, irrevocably and
unconditionally hereby releases, acquits and forever discharges and covenants
not to sue Employer, Cheviot Financial Corp., and any affiliate of Employer or
Cheviot Financial Corp., and their officers, directors, employees, successors
and assigns, from any and all claims, rights, demands, causes of action, suits,
arbitrations or grievances arising out of or relating to Employee’s employment
with Employer, including but not limited to claims for breach of contract,
claims arising under or related to the Employment Agreement, claims for age
discrimination under federal and state law, any other claims for discrimination,
and any other common law or statutory claims arising out of or relating to
Employee’s employment with Employer and/or his position(s) on the Board of
Directors of Employer and Cheviot Financial Corp.  The foregoing release shall
include any and all such claims which Employee could have asserted up to and
through the date on which this Agreement is executed by Employee, or the
Effective Date of Resignation, whichever date occurs later.  However, the
foregoing release shall not include claims for benefits under tax-qualified
plans or other benefit plans in which Employee is vested, or claims with respect
to Employer’s obligations set forth in this Agreement.  Employee agrees that he
cannot waive his right to file a charge with the Equal Employment Opportunity
Commission or Department of Labor, but should such a charge be filed, he waives
his right to receive any monetary relief from such charge(s).  Employee also
waives any right to payment of attorney's fees which might have been incurred by
him in connection with this Agreement or any claims released herein.

9.            Age Discrimination in Employment Act Release; Employee’s Rights
Under the Older Workers Benefit Protection Act.   Employee specifically agrees
to release all claims under the Age Discrimination in Employment Act.  In
compliance with the rights afforded him under the Older Workers Benefit
Protection Act, he is: (i) offered twenty-one (21) calendar days in which to
review the terms and effects of this Agreement in its entirety with an attorney
of his choice; (ii) advised to consult with an attorney; and (iii) afforded for
a period of seven (7) calendar days following the execution of this Agreement
the right to revoke this Agreement by notifying Employer in writing of such
revocation. If he exercises his revocation rights, Employer has the right to
revoke the remainder of this Agreement.

10.           Release from Employer to Employee.  Employer for itself and
Cheviot Financial Corp., and any affiliate of Employer or Cheviot Financial
Corp. and their officers, directors, employees, successors and assigns fully,
completely, irrevocably and unconditionally hereby releases, acquits and forever
discharges and covenants not to sue Employee, his personal representatives,
heirs and assigns, from any and all claims, rights, demands, causes of action,
suits, arbitrations or grievances arising out of or relating to Employee’s
employment with Employer, including but not limited to claims for breach of
contract, claims arising under or related to the Employment Agreement, and any
other common law or statutory claims arising out of or relating to Employee’s
employment with Employer and/or his position(s) on the Board of Directors of
Employer and Cheviot Financial Corp.  The foregoing release shall include any
and all such claims which Employer could have asserted up to and through the
date on which this Agreement is executed by Employee, or the Effective Date of
Resignation, whichever date occurs later.

 
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11.           Non-Disparagement.  Both parties acknowledge the importance of the
other party's excellent reputation in the community. Therefore, as a material
inducement for both parties to enter into this Agreement, both parties agree
that they shall not make any disparaging or negative statements, oral or
written, to anyone concerning or in any way relating to the other hereafter from
the date of this Agreement.

12.           Confidentiality. Both parties agree that following the execution
of this Agreement, they will not disclose or cause or allow to be disclosed the
existence of this Agreement or any of its terms, conditions, amounts or other
details except to the Bank’s Board of Directors, or to legal counsel, or as is
necessary to limit tax liability, or as otherwise required by law, including
disclosure to the SEC, or any other appropriate regulatory agency, on an SEC
Form 8-K.  Both parties acknowledge that these promises of confidentiality are
material to this Agreement and the parties' obligations hereunder.

13.           Non-Disclosure.  Employee also agrees to maintain the secrecy of
all confidential, proprietary, financial and other sensitive information of
Employer.  Employee agrees that he will not, directly or indirectly, personally
use or divulge, disclose or communicate to any person, corporation or other
entity, in any manner whatsoever, any information concerning any matters
affecting or relating to Employer, including but not limited to Employer’s
financial information, corporate information, trade secrets, methods,
techniques, processes, procedures, formulas, properties, data, inventions,
marketing plans and strategies.  Employee’s obligations under this section 13
shall be in addition to those non-disclosure and confidentiality obligations
referenced in section 17 below.

14.           Liquidated Damages.   Employee agrees that filing a lawsuit or
wage claim covered by this Agreement and/or violations of paragraphs 8, 9, 11,
12 or 13 of this Agreement shall constitute material breaches of this Agreement
and shall subject Employee to liability for payment of liquidated damages to
Employer.  Said liquidated damages shall be $100,000, and reasonable attorney’s
fees incurred by the Employer in connection with the recovery and collection of
the liquidated damages, and all other relief provided by law or equity.

15.           Offer of Compromise.  The parties agree that this Agreement is
made in the interest of anticipating and fully and forever compromising,
settling and resolving all unsettled issues, matters, disputes and potential
claims between the parties hereto.  Nothing contained in this Agreement shall
constitute any acknowledgment or admission of liability by Employer. The parties
agree that this Agreement is tendered with the intent to compromise and settle
claims or potential claims between the parties.  Because the Agreement is an
offer of settlement, the terms are privileged and confidential pursuant to the
applicable Ohio and Federal Rules of Evidence.  The parties agree and
acknowledge that this Agreement shall not be used for any purpose other than
settling the claims contained herein.
 
 
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16.           Cooperation/Compliance.   Employee agrees to fully cooperate with
Employer in performing his work duties in a diligent and satisfactory manner,
and complying with Employer’s rules and policies, up to and through the
Effective Date of Resignation.  In the event Employee fails to cooperate in such
a manner, Employer may require Employee to leave the employ of Employer
immediately, and the date on which Employee is required to leave the employ of
employer shall become the effective date of resignation for purposes of this
Agreement, and as that term is defined in section 1 above.  Employee
acknowledges and agrees that he has fulfilled his responsibilities under
Employer’s financial policies, business compliance policies, and business ethics
policies to the best of his knowledge and belief.  He agrees that he will not
pursue any legal action nor will he be a party to any legal action against
Employer.  After the date of this Agreement, he agrees that he will not provide
to any person, party or entity any factual information, documents or opinions
about such factual information relating to Employer’s financial information,
regulatory compliance or corporate compliance; provided however, that in the
event any state or federal government authority or regulatory agency
investigates Employer or any of its employees, he agrees to be forthcoming with
any information he may have.  Employer agrees to provide Employee with access to
any documentation utilized or prepared by Employee while employed at Employer in
the event he is requested to respond to any audit, investigation, regulatory,
legal or judicial proceeding of any nature whatsoever, upon written notification
to Employer.  Further, Employee agrees to assist and cooperate with Employer and
its insurance carriers with regard to any claims or lawsuits relating to any
action occurring while he was employed by Employer.

17.           Survival of Post-Termination Obligations.  The parties agree that
the Post-Termination Obligations contained in section 11 of the Employment
Agreement shall survive the termination of the Employment Agreement and shall
remain fully enforceable as provided for therein.  Employee specifically
acknowledges and agrees that he will remain subject to and be bound by the
covenants contained in section 11 of the Employment Agreement, including but not
limited to those covenants pertaining to non-solicitation, non-competition, and
Confidential Information.  The terms of section 11 of the Employment Agreement
are hereby incorporated herein by reference.

18.           Public Statement.  The parties agree that the public statement
attached hereto will be released by Employer to the press and to the general
public on February 3, 2015.  The parties agree that the release of said public
statement does not violate the terms of any confidentiality provision, or any
other provision, contained in this Agreement.  The public statement attached
hereto is incorporated herein by reference.

19.           Arbitration.  Upon demand of either party, any controversy between
the parties or claim by one party against the other arising out of or relating
to this Agreement, or a breach hereof, shall be settled by a mutually agreed
upon arbitrator(s), and such arbitration shall be in accordance with the
Commercial Arbitration Rules of the American Arbitration Association.  The
parties shall be bound by the decision of the arbitrator(s).  The arbitrator(s)
shall be bound by applicable agreements and Ohio statutes, regulations and rules
of procedure and the arbitrator(s) should permit reasonable discovery, issue
subpoenas, decide arbitrability issues, preserve order and privacy in the
hearings, rule on evidentiary matters, determine the close of the hearing and
the procedures for post-hearing submissions, and issue an award resolving the
submitted dispute.  The arbitrator(s) shall also have authority to rule on
motions to dismiss and motions for summary judgment, pursuant to the standards
set forth in the Federal Rules of Civil Procedure and/or applicable Ohio state
law.  The arbitrator(s) shall be able to apply substantive law as well as the
law that allocates burdens of proof.  The arbitration shall be held in
Cincinnati, Ohio, and any final decision of the arbitrator(s) shall be
enforceable by the courts of Hamilton County, Ohio.  The prevailing party shall
be reimbursed for its costs by the losing party.
 
 
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20.           Attorney Fees.  Employee shall be liable for all damages, costs
and attorney’s fees incurred by Employer in enforcing the terms of this
Agreement if a court of competent jurisdiction or arbitration tribunal finds
that Employee has breached any term or provision of this Agreement.

21.           Severability.  The parties agree that the provisions of this
Agreement are severable, and if any part of this Agreement is found to be
unenforceable, the other parts shall remain fully valid and enforceable.

22.           Choice of Law and Venue.  This Agreement shall be governed by and
construed according to the laws of the State of Ohio.  The exclusive venue for
any claim related to this Agreement shall be the courts of Hamilton County,
Ohio.
 
23.           Entire Agreement.  This Agreement represents the entire Agreement
between the parties.  Any prior or contemporaneous agreement between the
parties, either oral or written, concerning or related to the subject matter of
this Agreement, is hereby replaced and superseded by this Agreement.
 
IN WITNESS WHEREOF, Employer has caused this Agreement to be executed by its
duly authorized representative, and Employee has hereunto set his hand, all as
of the day and year first above written.

Thomas J. Linneman
 
 
/s/ Thomas J. Linneman                                                      
Signature
 
February 3, 2015                                                      
Date
 
 
Cheviot Savings Bank
 
By: /s/ Robert L.
Thomas                                                                
 
Title: Lead Independent
Director                                                                
 
 
Date: February 3,
2015                                                                
 
 

 

 
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