Exhibit 10.2


 


AMENDED AND RESTATED EMPLOYMENT AGREEMENT


 


THIS AMENDED
AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is dated as of October 23,
2007 and is between Willow Financial Bancorp, Inc., a Pennsylvania corporation
(the “Corporation”), Willow Financial Bank, a federally chartered savings bank and
wholly owned subsidiary of the Corporation (the “Bank”), and Joseph T. Crowley (the
“Executive”).


 


WITNESSETH


 


WHEREAS, the
Corporation was previously known as Willow Grove Bancorp, Inc., and the Bank
was previously known as Willow Grove Bank;


 


WHEREAS, the
Executive is currently employed as the Chief Financial Officer of the
Corporation and the Bank, and the Corporation, the Bank and the Executive have
previously entered into an employment agreement dated July 15, 2005 (the “Prior
Agreement”);


 


WHEREAS, the
Corporation and the Bank (together the “Employers”) desire to amend and restate
the Prior Agreement in order to make changes to comply with Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”), as well as certain
other changes; and


 


WHEREAS, in
order to induce the Executive to remain in the employ of the Employers and in
consideration of the Executive’s agreeing to remain in the employ of the
Employers, the parties desire to specify the severance benefits which shall be
due the Executive by the Employers in the event that his employment with the
Employers is terminated under specified circumstances;


 


NOW THEREFORE,
in consideration of the mutual agreements herein contained, and upon the other
terms and conditions hereinafter provided, the parties hereby agree as follows:


 


1.                                      Definitions.
The following words and terms shall have the meanings set forth below for
the purposes of this Agreement:


 


(a)                                  Average Annual Compensation. The Executive’s “Average Annual
Compensation” for purposes of this Agreement shall be deemed to mean the
average amount of Base Salary and cash bonus paid to the Executive by the
Employers or any subsidiary thereof during the most recent five calendar years
preceding the year in which the Date of Termination occurs (or such shorter
period as the Executive was employed).


 


(b)                                 Base Salary. “Base Salary” shall have the
meaning set forth in Section 3(a) hereof.


 


(c)                                  Cause. Termination of the Executive’s
employment for “Cause” shall mean termination because of personal dishonesty,
incompetence, willful misconduct, breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, willful violation of any
law, rule or regulation (other than traffic violations or similar offenses) or
final cease-and-desist order, or material breach of any provision of this
Agreement.


 

















 


(d)                                 Change in Control. “Change in Control shall
mean a change in the ownership of the Corporation or the Bank, a change in the
effective control of the Corporation or the Bank or a change in the ownership
of a substantial portion of the assets of the Corporation or the Bank, in each
case as provided under Section 409A of the Code and the regulations thereunder.


 


(e)                                  Date of Termination. “Date of Termination”
shall mean (i) if the Executive’s employment is terminated for Cause, the date on
which the Notice of Termination is given, (ii) if the Executive’s employment is
terminated due to his death, the date of death, and (iii) if the Executive’s
employment is terminated for any other reason, the date specified in such
Notice of Termination.


 


(f)                                    Disability. “Disability” shall mean the
Executive (i) is unable to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than 12 months, or (ii) is, by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can
be expected to last for a continuous period of not less than 12 months,
receiving income replacement benefits for a period of not less than three
months under an accident and health plan covering employees of the Employers.


 


(g)                                 Effective Date. The Effective Date of this Agreement shall
mean the date first written above.


 


(h)                                 Good Reason. Termination by the Executive
of the Executive’s employment for “Good Reason” shall mean termination by the
Executive  based on the occurrence of any of the
following events:


 


(i) any material breach of this Agreement by the Employers, including
without limitation any of the following: (A) a material diminution in the
Executive’s base compensation, (B) a material diminution in the Executive’s
authority, duties or responsibilities as prescribed in Section 2, or (C) a
material diminution in the authority, duties or responsibilities of the officer
to whom the Executive is required to report, or


 


(ii) any material change in the geographic location at which the
Executive must perform his services under this Agreement;


 


provided, however, that prior
to any termination of employment for Good Reason, the Executive must first
provide written notice to the Employers within ninety (90) days of the initial
existence of the condition, describing the existence of such condition, and the
Employers shall thereafter have the right to remedy the condition within thirty
(30) days of the date the Employers received the written notice from the
Executive. If the Employers remedy the condition within such thirty (30) day
cure period, then no Good Reason shall be deemed to exist with respect to such
condition. If the Employers do not remedy the condition within such thirty (30)
day cure period, then the Executive may deliver a Notice of Termination for
Good Reason at any time within sixty (60) days following the expiration of such
cure period.


 


(i)                                     IRS. IRS shall mean the Internal Revenue
Service.


 


2

















 


(j)                                     Notice of Termination. Any purported
termination of the Executive’s employment by the Employers for any reason,
including without limitation for Cause, Disability or Retirement, or by the
Executive for any reason, including without limitation for Good Reason, shall be
communicated by a written “Notice of Termination” to the other party hereto. For
purposes of this Agreement, a “Notice of Termination” shall mean a dated notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) sets forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Executive’s employment under the
provision so indicated, (iii) specifies a Date of Termination, which shall be
not less than thirty (30) nor more than ninety (90) days after such Notice of
Termination is given, except in the case of the Employers’ termination of the Executive’s
employment for Cause, which shall be effective immediately, and except as set
forth in Section 19(a) hereof; and (iv) is given in the manner specified in
Section 11 hereof.


 


(k)                                  Retirement. “Retirement” shall mean
voluntary termination by the Executive in accordance with the Employers’
retirement policies, including early retirement, generally applicable to their
salaried employees.


 


2.                                      Term
of Employment.


 


(a)                                  The
Employers hereby employ the Executive as Chief Financial Officer, and the
Executive hereby accepts said employment and agrees to render such services to the
Employers on the terms and conditions set forth in this Agreement. Unless
extended as provided in this Section 2, this Agreement shall terminate on June
30, 2008. Prior to July 1, 2008 and each July 1 thereafter, the Boards of
Directors of the Employers shall consider and review (after taking into account
all relevant factors, including the Executive’s performance hereunder) a
one-year extension of the term of this Agreement, and the term shall continue
to extend each July 1 if the Boards of Directors approve  such extension unless the Executive gives
written notice to the Employers of the Executive’s election not to extend the
term, with such written notice to be given not less than thirty (30) days prior
to any such July 1. If the Boards of Directors of the Employers elect not to
extend the term, they shall give written notice of such decision to the
Executive not less than thirty (30) days prior to any such July 1. If any party
gives timely notice that the term will not be extended as of any July 1, then
this Agreement shall terminate at the conclusion of its remaining term. References
herein to the term of this Agreement shall refer both to the initial term and
successive terms.


 


(b)                                 During
the term of this Agreement, the Executive shall perform such executive services
for the Employers as may be consistent with his titles and from time to time
assigned to him by the Boards of Directors of the Employers. During the term of
this Agreement, the Executive shall devote his best efforts and his full time
effort to the affairs and business of the Employers.


 


3.                                      Compensation
and Benefits.


 


(a)                                  Base Salary. The Employers shall compensate and pay the
Executive for his services during the term of this Agreement at a minimum base
salary of $222,000 per year (“Base Salary”), which may be increased from time
to time in such amounts as may be determined by the Boards of Directors of the
Employers and may not be decreased without the Executive’s express written 


 


3

















 


consent. In addition to his Base
Salary, the Executive shall be entitled to receive during the term of this
Agreement such bonus payments as may be determined by the Boards of Directors
of the Employers.


 


(b)                                 Benefit Plans. During the term of this Agreement, the
Executive shall be entitled to participate in and receive the benefits of any
pension or other retirement benefit plan, profit sharing, stock option,
employee stock ownership, or other plans, benefits and privileges given to
employees and executives of the Employers, to the extent commensurate with his
then duties and responsibilities, as fixed by the Boards of Directors of the
Employers. The Employers shall not make any changes in such plans, benefits or
privileges which would adversely affect the Executive’s rights or benefits
thereunder, unless such change occurs pursuant to a program applicable to all
executive officers of the Employers and does not result in a disproportionately
greater adverse change in the rights of or benefits to the Executive as
compared with any other executive officer of the Employers. Nothing paid to the
Executive under any plan or arrangement presently in effect or made available
in the future shall be deemed to be in lieu of the salary payable to the
Executive pursuant to Section 3(a) hereof.


 


(c)                                  Paid Time Off. During the term of this Agreement, the
Executive shall be entitled to paid time off in accordance with the policies as
established from time to time by the Boards of Directors of the Employers. The
Executive shall not be entitled to receive any additional compensation from the
Employers for failure to utilize such paid time off, nor shall the Executive be
able to accumulate unused paid time off from one year to the next, except to
the extent authorized by the Boards of Directors of the Employers.


 


(d)                                 Proration. The Executive’s compensation, benefit and
expenses shall be paid by the Corporation and the Bank in the same proportion
as the time and services actually expended by the Executive on behalf of each
respective Employer.


 


4.                                      Expenses.
The Employers shall reimburse the Executive or otherwise provide for or pay
for all reasonable expenses incurred by the Executive in furtherance of or in
connection with the business of the Employers, including, but not by way of
limitation, automobile expenses and other traveling expenses, subject to such
reasonable documentation and other limitations as may be established by the
Boards of Directors of the Employers. If such expenses are paid in the first
instance by the Executive, the Employers shall reimburse the Executive
therefor. Such reimbursement shall be paid promptly by the Employers and in any
event no later than March 15 of the year immediately following the year in
which such expenses were incurred.


 


5.                                      Termination.


 


(a)                                  General. The Employers shall have the right, at any time
upon prior Notice of Termination, to terminate the Executive’s employment
hereunder for any reason, including without limitation termination for Cause,
Disability or Retirement, and the Executive shall have the right, upon prior
Notice of Termination, to terminate his employment hereunder for any reason.


 


4

















 


(b)                                 For Cause. In the event that the Executive’s employment is
terminated by the Employers for Cause, the Executive shall have no right
pursuant to this Agreement to compensation or other benefits for any period
after the applicable Date of Termination.


 


(c)                                  Voluntary Termination by the Executive. In the event the
Executive terminates his employment hereunder other than for death, Disability,
Retirement, Good Reason or an uncured material breach of this Agreement by the
Employers, then the Executive shall have no right pursuant to this Agreement to
compensation or other benefits for any period after the applicable Date of
Termination.


 


(d)                                 Death. In the event the Executive’s employment hereunder is
terminated due to death, neither the Executive nor his estate or named
beneficiaries shall have any right pursuant to this Agreement to compensation
or other benefits for any period after the Date of Termination.


 


(e)                                  Disability. In the event the Executive’s employment
hereunder is terminated due to Disability, the Executive shall be entitled to
receive any disability benefits provided under any disability plan maintained
by the Employers. Other than as set forth above, the Executive shall have no
right pursuant to this Agreement to compensation or other benefits for any
period after the Date of Termination.


 


(f)                                    Retirement. In the event the Executive’s employment
hereunder is terminated due to Retirement, the Executive shall have no right
pursuant to this Agreement to compensation or other benefits for any period
after the Date of Termination.


 


(g)                                 Involuntary Termination. In the event that (i) the Executive’s
employment is terminated by the Employers for other than Cause, Disability,
Retirement or the Executive’s death or (ii) such employment is terminated by
the Executive for Good Reason, then the Employers shall pay to the Executive,
within thirty (30) days following the Date of Termination, a cash severance
amount equal to one times the Executive’s current Base Salary; provided,
however, that this Section 5(g) shall not be applicable if the termination of
employment occurs concurrently with or subsequent to a Change in Control.


 


(h)                                 Change in Control Termination. In the event that (i) the
Executive’s employment is terminated concurrently with or within twelve (12)
months following a Change in Control for other than Cause, Disability,
Retirement or the Executive’s death or (ii) the Executive elects to terminate his
employment for Good Reason, then the Employers shall, subject to the provisions
of Section 6 hereof, if applicable,


 


(A)                              pay
to the Executive, within thirty (30) days following the Date of Termination, a
cash severance amount equal to two (2) times the Executive’s Average Annual
Compensation;


 


(B)                                maintain and provide
for a period ending at the earlier of (i) one year subsequent to the Date of
Termination or (ii) the date of the Executive’s full-time employment by another
employer (provided that the Executive is entitled under the terms of such
employment to benefits substantially similar to those described in this
subparagraph 


 


5

















 


(B)), at no cost to the Executive, the Executive’s continued
participation in all group insurance, life insurance, health and accident
insurance, and disability insurance offered by the Employers in which the
Executive was participating immediately prior to the Date of Termination;
provided that any insurance premiums payable by the Employers or any successors
pursuant to this Section 5(h)(B) shall be payable at such times and in such
amounts as if the Executive was still an employee of the Employers, subject to
any increases in such amounts imposed by the insurance company or COBRA, and
the amount of insurance premiums required to be paid by the Employers in any
taxable year shall not affect the amount of insurance premiums required to be
paid by the Employers in any other taxable year; and provided further that if
the Executive’s participation in any group insurance plan is barred, the
Employers shall either arrange to provide the Executive with insurance benefits
substantially similar to those which the Executive was entitled to receive
under such group insurance plan or, if such coverage cannot be obtained, pay a
lump sum cash equivalency amount within thirty (30) days following the Date of
Termination based on the annualized rate of premiums being paid by the
Employers as of the Date of Termination; and


 


(C)                                pay
to the Executive, in a lump sum within thirty (30) days following the Date of
Termination, a cash amount equal to the projected cost to the Employers of
providing benefits to the Executive for a period of twelve (12) months pursuant
to any other employee benefit plans, programs or arrangements offered by the
Employers in which the Executive was entitled to participate immediately prior
to the Date of Termination (excluding (y) stock option plans, restricted stock
plans and employee stock ownership plans of the Employers and (z) bonuses and other
items of cash compensation), with the projected cost to the Employers to be
based on the costs incurred for the calendar year immediately preceding the
year in which the Date of Termination occurs and with any automobile-related
costs to exclude any depreciation on Bank-owned automobiles.


 


6.                                      Limitation
of Benefits under Certain Circumstances. If the payments and benefits
pursuant to Section 5 hereof, either alone or together with other payments and
benefits which the Executive has the right to receive from the Employers and their
affiliates, would constitute a “parachute payment” under Section 280G of the
Code, then the payments and benefits payable by the Employers pursuant to
Section 5 hereof shall be reduced by the minimum amount necessary to result in
no portion of the payments and benefits payable by the Employers under Section
5 being non-deductible to the Employers pursuant to Section 280G of the Code
and subject to the excise tax imposed under Section 4999 of the Code. If the
payments and benefits under Section 5 are required to be reduced, the cash
severance shall be reduced first, followed by a reduction in the fringe
benefits. The determination of any reduction in the payments and benefits to be
made pursuant to Section 5 shall be based upon the opinion of independent
counsel selected by the Employers and paid by the Employers. Such counsel shall
promptly prepare the foregoing opinion, but in no event later than thirty (30)
days from the Date of Termination, and may use such actuaries as such counsel
deems necessary or advisable for the purpose. Nothing contained in this Section
6 shall result in a reduction of any payments or benefits to which the
Executive may be entitled upon termination of employment under any
circumstances other than as specified in this Section 6, or a reduction in the
payments and benefits specified in Section 5 below zero.


 


6

















 


7.                                      Mitigation;
Exclusivity of Benefits.


 


(a)                                  The
Executive shall not be required to mitigate the amount of any benefits
hereunder by seeking other employment or otherwise, nor shall the amount of any
such benefits be reduced by any compensation earned by the Executive as a
result of employment by another employer after the Date of Termination or otherwise,
except as set forth in Section 5(h)(B)(ii) hereof.


 


(b)                                 The
specific arrangements referred to herein are not intended to exclude any other
benefits which may be available to the Executive upon a termination of
employment with the Employers pursuant to employee benefit plans of the
Employers or otherwise.


 


8.                                      Withholding.
All payments required to be made by the Employers hereunder to the
Executive shall be subject to the withholding of such amounts, if any, relating
to tax and other payroll deductions as the Employers may reasonably determine
should be withheld pursuant to any applicable law or regulation.


 


9.                                      Competitive
Activities.


 


(a)                                  The
Executive agrees and acknowledges that by virtue of his employment hereunder,
he will maintain an intimate knowledge of the activities and affairs of the
Employers, including trade secrets, plans, business plans, strategies,
projections, market studies, customer information, employee records and other
internal proprietary and confidential information and matters (collectively “Confidential
Information”). As a result, and also because of the special, unique and
extraordinary services that the Executive is capable of performing for the
Employers or one of its competitors, the Executive recognizes that the services
to be rendered by him hereunder are of a character giving them a peculiar
value, the loss of which cannot be adequately or reasonably compensated for by
damages.


 


(b)                                 Except
for the purpose of carrying out his duties hereunder, the Executive will not
remove or retain, or make copies or reproductions of, any figures, documents,
records, discs, computer records, calculations, letters, papers, or recorded or
documented information of any type or description relating to the business of the
Employers. The Executive agrees that he will not divulge to others any
information (whether or not documented or recorded) or data acquired by him
while in the Employers’ employ relating to methods, processes or other trade
secrets or other Confidential Information.


 


(c)                                  The
Executive agrees that the Employers are, and shall be, the sole and exclusive
owner of all improvements, ideas and suggestions, whether or not subject to
patent or trademark protection, and all copyrightable materials which are
conceived by the Executive during his employment, which relate to the business
of the Employers, which are confidential, or which are not readily
ascertainable from persons or other sources outside the Employers.


 


(d)                                 Unless
the Executive’s employment is terminated in connection with or following a
Change in Control, then for a period of one year after the termination of
employment, the Executive shall not, directly or indirectly, solicit, induce,
encourage or attempt to influence any client, customer or employee of the
Employers to cease to do business with, or to terminate any employee’s 


 


7

















 


employment with, the Employers.
The Executive shall not be subject to any of the limitations set forth in the
preceding sentence if the Executive’s employment is terminated in connection
with or following a Change in Control.


 


(e)                                  The
Executive agrees that during the term of his employment hereunder, except with
the express consent of the Employers, he will not, directly or indirectly,
engage or participate in, become a director of, or render advisory or other
services for, or in connection with, or become interested in, or make any
financial investment in any firm, corporation, business entity or business
enterprise competitive with or to any business of the Employers; provided,
however, that the Executive shall not thereby be precluded or prohibited from
owning passive investments, including investments in the securities of other
financial institutions, so long as such ownership does not require him to devote
substantial time to management or control of the business or activities in
which he has invested. Notwithstanding anything to the contrary contained in
this Agreement, during the term of this Agreement, the Executive shall have no
employment contract or other written or oral agreement concerning employment as
an officer of a savings bank or any other financial institution or financial
institution holding company nor with any other entity or person other than the
Bank or the Corporation. The provisions of this Section 9(e) shall not be
applicable if the Executive’s employment is terminated in connection with or
following a Change in Control.


 


(f)                                    The
Employers shall be entitled to immediate injunctive or other equitable relief
to restrain the Executive from failing to comply with any obligation under this
Section 9 or from rendering his services to persons or entities than the
Employers, in addition to any other remedies to which the Employers may be
entitled under law. The right to such injunctive or other equitable relief
shall survive the termination by the Employers of the Executive’s employment.


 


(g)                                 The
Executive acknowledges that the restrictions contained in this Section 9 are
reasonable and necessary to protect the legitimate interests of the Employers
and that any violation thereof would result in irreparable injuries to the
Employers. The Executive acknowledges that, if the Executive violates any of
these restrictions, the Employers are entitled to obtain from any court of
competent jurisdiction, preliminary and permanent injunctive relief as well as
damages, and an equitable accounting of any earnings, profits and other
benefits arising from such violation, which rights shall be cumulative and in
addition to any other rights or remedies to which the Employers may be entitled.
The Executive further acknowledges that the provisions of Sections 9(a), (b),
(c), (f) and (g) shall remain in full force and effect beyond the termination
of the Executive’s employment for any reason, including but not limited to
termination in connection with or following a Change in Control.


 


10.                               Assignability.
The Employers may assign this Agreement and their rights and obligations
hereunder in whole, but not in part, to any corporation, bank or other entity
with or into which the Employers may hereafter merge or consolidate or to which
the Employers may transfer all or substantially all of their assets, if in any
such case said corporation, bank or other entity shall by operation of law or
expressly in writing assume all obligations of the Employers hereunder as fully
as if it had been originally made a party hereto, but may not otherwise assign
this Agreement or their rights and obligations hereunder. The Executive may not
assign or transfer this Agreement or any rights or obligations hereunder.


 


8

















 


11.                               Notice.
For the purposes of this Agreement, notices and all other communications
provided for in this Agreement shall be in writing and shall be deemed to have
been duly given when delivered or mailed by first-class certified or registered
mail, return receipt requested, postage prepaid, addressed to the respective
addresses set forth below:


 


To the Employers:                                                          Secretary


Willow Financial Bancorp, Inc.


170 South Warner Road


Wayne, Pennsylvania  19087


 


To the Executive:                                                               Joseph
T. Crowley


At his last address on file with


the Employers


 


12.                               Amendment;
Waiver. No provisions of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in
writing and signed by the Executive and such officer or officers as may be
specifically designated by the Boards of Directors of the Employers to sign on their
behalf. No waiver by any party hereto at any time of any breach by any other
party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. In addition, notwithstanding anything in this Agreement to the
contrary, the Employers may amend in good faith any terms of this Agreement,
including retroactively, in order to comply with Section 409A of the Code.


 


13.                               Governing
Law. The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the United States where applicable
and otherwise by the substantive laws of the Commonwealth of Pennsylvania.


 


14.                               Nature
of Obligations. Nothing contained herein shall create or require the Employers
to create a trust of any kind to fund any benefits which may be payable
hereunder, and to the extent that the Executive acquires a right to receive
benefits from the Employers hereunder, such right shall be no greater than the
right of any unsecured general creditor of the Employers.


 


15.                               Headings.
The section headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement.


 


16.                               Validity.
The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provisions of this
Agreement, which shall remain in full force and effect.


 


17.                               Changes in Statutes or Regulations. If any statutory or
regulation provision referenced herein is subsequently changed or re-numbered,
or is replaced by a separate provision, then the references in this Agreement
to such statutory or regulatory provision shall be deemed to be a reference to
such section as amended, re-numbered or replaced.


 


9

















 


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


 


19.                               Regulatory
Actions. The following provisions shall be applicable to the parties to the
extent that they are required to be included in employment agreements between a
savings association and its employees pursuant to Section 563.39(b) of the
Regulations Applicable to All Savings Associations, 12 C.F.R. §563.39(b), or
any successor thereto, and shall be controlling in the event of a conflict with
any other provision of this Agreement, including without limitation Section 5
hereof.


 


(a)                                  The
Bank’s Board of Directors may terminate the Executive’s employment at any time,
but any termination by the Bank’s Board of Directors, other than termination
for Cause, shall not prejudice the Executive’s right to compensation or other
benefits under this Agreement.


 


(b)                                 If
the Executive is suspended from office and/or temporarily prohibited from
participating in the conduct of the Employers’ affairs by a notice served under
Section 8(e)(3) or Section 8(g)(1) of the Federal Deposit Insurance Act (“FDIA”)
(12 U.S.C. §1818(e)(3) and 1818(g)(1)), the Employers’ obligations under this
Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the
Employers may, in their discretion:  (i)
pay the Executive all or part of the compensation withheld while their
obligations under this Agreement were suspended, and (ii) reinstate (in whole
or in part) any of their obligations which were suspended.


 


(c)                                  If
the Executive is removed from office and/or permanently prohibited from
participating in the conduct of the Employers’ affairs by an order issued under
Section 8(e)(4) or Section 8(g)(1) of the FDIA (12 U.S.C. §1818(e)(4) and
(g)(1)), all obligations of the Employers under this Agreement shall terminate
as of the effective date of the order, but vested rights of the Executive and the
Employers as of the date of termination shall not be affected.


 


(d)                                 If
the Bank is in default, as defined in Section 3(x)(1) of the FDIA (12 U.S.C. §1813(x)(1)),
all obligations under this Agreement shall terminate as of the date of default,
but vested rights of the Executive and the Employers as of the date of
termination shall not be affected.


 


(e)                                  All
obligations under this Agreement shall be terminated pursuant to 12 C.F.R. §563.39(b)(5),
except to the extent that it is determined that continuation of the Agreement
for the continued operation of the Employers is necessary: (i) by the Director
of the Office of Thrift Supervision (“OTS”), or his/her designee, at the time
the Federal Deposit Insurance Corporation (“FDIC”) enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) of the FDIA (12 U.S.C. §1823(c)); or (ii) by the Director of the
OTS, or his/her designee, at the time the Director or his/her designee approves
a supervisory merger to resolve problems related to operation of the Bank or
when the Bank is determined by the Director of the OTS to be in an unsafe or
unsound condition, but vested rights of the Executive and the Employers as of
the date of termination shall not be affected.


 


10

















 


20.                               Indemnification.


 


(a)                                  The Corporation shall
provide the Executive (including his heirs, executors and administrators) with
coverage under a directors’ and officers’ liability insurance policy at its
expense and shall indemnify the Executive (and his heirs, executors and
administrators) to the fullest extent permitted by law against all expenses and
liabilities reasonably incurred by him in connection with or arising out of any
action, suit or proceeding in which he may be involved by reason of his having
been a director or officer of the Corporation or any of its subsidiaries or
affiliates (whether or not he continues to be a director or officer at the time
of incurring such expenses or liabilities). Such expenses and liabilities shall
include, but shall not be limited to, judgments, court costs and attorneys’
fees and the cost of reasonable settlements. The parties hereto acknowledge and
agree that, for purposes of the right to indemnification by the Corporation as
provided by Article VI of the Corporation’s Amended and Restated Bylaws, the
Executive also is serving as an officer of the Bank at the request of the Corporation.


 


(b)                                 Any indemnification
provided to the Executive by the Bank shall comply with 12 C.F.R. §545.121 or
any successor regulation applicable to the Bank.


 


21.                               Regulatory
Prohibition. Notwithstanding any other provision of this Agreement to the
contrary, any payments made to the Executive pursuant to this Agreement, or
otherwise, are subject to and conditioned upon their compliance with Section
18(k) of the FDIA (12 U.S.C. §1828(k)) and the regulations promulgated
thereunder, including 12 C.F.R. Part 359. In the event of the Executive’s
termination of employment with the Bank for Cause, all employment relationships
and managerial duties with the Bank shall immediately cease regardless of
whether the Executive remains in the employ of the Corporation following such
termination. Furthermore, following such termination for Cause, the Executive
will not, directly or indirectly, influence or participate in the affairs or
the operations of the Bank, and any compensation and benefits which the
Executive may continue to receive from the Corporation pursuant to Section 3
hereof shall be adjusted as appropriate so that they are commensurate solely
with the Executive’s duties to the Corporation.


 


22.                               Payment
of Costs and Legal Fees and Reinstatement of Benefits. In the event any
dispute or controversy arising under or in connection with the Executive’s
termination is resolved in favor of the Executive, whether by judgment,
arbitration or settlement, the Executive shall be entitled to the payment of
(a) all legal fees incurred by the Executive in resolving such dispute or controversy,
and (b) any back-pay, including Base Salary, bonuses and any other cash
compensation, fringe benefits and any compensation and benefits due to the
Executive under this Agreement, within thirty (30) days following the date such
judgment, arbitration or settlement becomes final and non-appealable.


 


23.                               Entire
Agreement. This Agreement embodies the entire agreement between the
Employers and the Executive with respect to the matters agreed to herein. All
prior agreements between the Employers and the Executive with respect to the
matters agreed to herein are hereby superseded and shall have no force or
effect, including the Prior Agreement, the agreement between the parties dated
March 23, 2005 and the agreement dated July 29, 2003 between Chester Valley
Bancorp, Inc., First Financial and the Executive.


 


11

















 


IN WITNESS
WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first written above.


 


 


	
  Attest:

  	
  WILLOW
  FINANCIAL BANCORP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Joseph
  T. Crowley

  	
   

  	
  By:

  	
  /s/ Donna M.
  Coughey

  
	
  Joseph T.
  Crowley

  	
   

  	
  Donna M.
  Coughey

  
	
  Senior Vice
  President, Chief

  	
   

  	
  President
  and Chief Executive Officer

  
	
   

  	
  Financial
  Officer and

  	
   

  	
   

  
	
   

  	
  Corporate Secretary

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attest:

  	
  WILLOW
  FINANCIAL  BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Joseph
  T. Crowley

  	
   

  	
  By:

  	
  /s/ Donna M.
  Coughey

  
	
  Joseph T.
  Crowley

  	
   

  	
  Donna M.
  Coughey

  
	
  Senior Vice
  President, Chief

  	
   

  	
  President
  and Chief Executive Officer

  
	
   

  	
  Financial
  Officer and 

  	
   

  
	
   

  	
  Corporate Secretary

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph
  T. Crowley

  
	
   

  	
   

  	
  Joseph T.
  Crowley

  
					



 


12