Exhibit 10.2


 


RETIREMENT
AND SEVERANCE AGREEMENT


 


This Retirement and Severance Agreement (the “Agreement”)
is made this 20th day of January, 2005, by and among Frederick A. Marcell Jr.
(the “Executive”), Willow Grove Bancorp, Inc., a Pennsylvania corporation (the “Company”),
and its wholly owned subsidiary, Willow Grove Bank, a federally chartered
savings bank (the “Bank”).


 


WITNESSETH:


 


WHEREAS, the Executive currently serves as
President and Chief Executive Officer of the Company and the Bank (collectively,
the “Employers”) and as an officer with respect to certain subsidiary
corporations; and


 


WHEREAS, the Executive currently is a party
to agreements with both the Company and the Bank, each dated as of May 1, 2004
(the “Employment Agreements”), setting forth the terms and conditions of his
employment; and


 


WHEREAS, the Executive and the Bank currently
are parties to a Supplemental Retirement Agreement, dated as of July 28,
1998 (the “SERP”); and


 


WHEREAS, the Executive and the Employers have
come to agreements in principle with respect to Executive’s retirement from the
Employers, the resignation of his positions therefrom and the terms and
conditions under which he will retire and receive certain benefits.


 


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


 


1.                                       Termination
of Employment Agreements; Modification of Duties.


 


(a)                                  As of the Commencement
Date (as hereinafter defined), the Employment Agreements, by the mutual
agreement of the parties hereto, shall be terminated and be of no further force
and effect and the Executive shall be entitled to the rights and payments set
forth herein in lieu of any rights and payments under the Employment
Agreements.  The Executive shall no
longer be considered an officer or executive of the Employers or any of their
respective subsidiaries as of the Commencement Date.  This Agreement shall have no effect on
Executive’s service as a director of each of the Company and the Bank. The
Executive has been nominated to an additional three-year term as a director of
the Company and the Bank and, subject to shareholder approval with respect to
the Company, shall continue to serve on the Boards of Directors of the Company
and the Bank for the remainder of such term and, subject to Section 4(c)
below, be entitled to the benefits therefrom.


 


(b)                                 The parties hereto
agree that, from the Commencement Date through April 30, 2006 (the “Consulting
Period”), the Executive shall provide certain consulting services to the
Company and the Bank as described below.


 





















 


(c)                                  The Commencement Date
shall be the first day of employment by the Employers of an individual other
than the Executive to fill the positions of President and Chief Executive Officer
of the Employers.


 


2.                                       Consultancy.


 


(a)                                  During the Consulting
Period, the parties agree that the Executive will provide his personal advice
and counsel to the Company and the Bank in connection with their businesses
including, but not limited to, consulting with the Company and the Bank
regarding matters identified by the Board of Directors with respect to the
transition to a new President and Chief Executive Officer as well as other
matters regarding the operations of the Company and the Bank and relationships
with customers and stockholders as may be identified by the Board of Directors (the
“Consulting Services”), subject to the terms and conditions set forth
herein.  The Executive shall provide such
Consulting Services as may be reasonably requested by the Board of Directors of
the Company from time to time at mutually agreeable and reasonable times,
provided, however, that the Executive will not be required to provide Consulting
Services which exceed (i) 30 hours per month during the first three months
after the date of this Agreement or (ii) 15 hours per month thereafter.  Such Consulting Services may be provided at
reasonable times either in person, telephonically, electronically or by
correspondence as the Company and the Executive may agree.


 


(b)                                 During the Consulting
Period, the Executive shall be treated as an independent contractor and shall
not be deemed to be an employee of the Company, the Bank or any other affiliate
of the Company.


 


3.                                       Consulting
Fee.  During the Consulting Period,
the Executive shall be entitled to receive a fee (the “Consulting Fee”) in an
amount equal to $244,800 per annum, payable in regularly scheduled bi-weekly
installments through April 30, 2006. 
In the event of Executive’s death during the Consulting Period, no further
payment of the Consulting Fee shall be required of the Company and the Bank and
the estate and family of the Executive shall not be entitled to receive any
additional portion of the Consulting Fee.


 


4.                                       Other
Benefits.


 


(a)                                  During the Consulting
Period, the Employers shall provide continued life, medical and dental coverage
substantially identical to the coverage maintained by the Employers for the
Executive immediately prior to the date hereof. 
In the event of the Executive’s death during the Consulting Period, the
Employers shall, through April 30, 2006, provide to the Executive’s spouse
continued medical and dental coverage substantially identical to the coverage
maintained by the Employers for the Executive immediately prior to his death.  The parties hereto agree that the Executive
is, and shall continue to be as of the Commencement Date, the owner of a term
life insurance policy, dated January 6, 1999, on the Executive, provided,
however, that the premiums for such policy, which heretofore have been paid by
the Employers and included as compensation to the Executive, shall, as of the
Commencement Date, become the obligation solely of the Executive.


 


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(b)                                 The Executive’s
benefits under the SERP shall be fully vested as of the date hereof, provided,
however, that the parties agree that payment of Executive’s Supplemental
Retirement Benefit (as such term is defined in the SERP) shall commence on the
first day of the month following Executive’s sixty-eighth (68th)
birthday and shall continue for a period of ten (10) years thereafter in
accordance with the terms of the SERP.


 


(c)                                  The parties agree
that the Executive will not receive fees for his service as a director during
the Consulting Period.  The Executive
will be entitled to all other benefits afforded to other directors, including
continued participation and vesting in the Company’s stock option plans and
recognition and retention plans.


 


5.                                       Solicitation
of Customers; Use of Customer Lists, etc.  The Executive acknowledges that, except as
required by law or in his own good faith use in any proceeding, he has no right
personally to use or disclose to any person, firm or corporation, information
concerning any customer list, business secrets or confidential financial
information of the Employers that he knew was intended by the Employers to be
confidential and that he did not have reason to believe had been made public
(collectively, “Confidential Information”). 
Accordingly, the Executive covenants and agrees that he shall not use or
permit the use of any Confidential Information, and shall not divulge any
Confidential Information to any person, firm or corporation, except as may be
required by applicable law arising out of his employment with or participation
in the affairs of the Employers. 
Further, Executive agrees that, through the period ending on October 31,
2006, he will not solicit any current customer of the Employers, for the
purpose or intent to provide or sell to such customers any banking, financial
or business services or products on behalf of any person, company or entity
other than the Employers without the express written consent of the Employers.


 


6.                                       Confidentiality;
Non-Disparagement.


 


(a)                                  No disclosure of the
contents of this Agreement shall be made by either party to this Agreement
without the prior written consent of the other party; provided that such
disclosure (including disclosures contained in Company press releases,
requisite disclosure in the Company’s reports filed with the Securities and
Exchange Commission and other regulatory filings) may be made as required in
accordance with federal securities law and regulations.


 


(b)                                 Executive agrees not
to make, either directly or indirectly, or cause to be made, either directly or
indirectly, by any other person or entity, any statement or comment, whether
oral, written, electronic or otherwise, or to take any other action which
disparages or criticizes the Employers, 
their present or former directors, officers, Executives, management,
practices or services, or which disrupts or impairs or could disrupt or impair
the operations of the Employers, where such statements, comments or actions are
based upon the Executive=s employment by the Employers,
either as a director, officer or Executive, or knowledge gained as a result of
such employment.  The Employers agree not
to make, either directly or indirectly, or cause to be made, either directly or
indirectly, by any other person or entity, or permit to be made by any
director, officer, Executive or representative of the Employers, any statement
or comment, whether oral, written, electronic or otherwise, or to take any
other action which


 


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disparages or criticizes the Executive where such statements, comments
or actions are based upon the Executive=s
employment by the Employers, either as a director, officer or Executive.


 


7.                           Remedies


 


(a)                                  The parties agree
that monetary damages for the breach of the agreements in Section 5 and Section 6
hereof may be impossible to determine or may be an inadequate remedy;
therefore, it is agreed that the Employers may adjudicate any such alleged
breach in a court of equity and that such court shall have the power to grant
injunctive or other appropriate equitable relief.  The parties also agree that it may be
impossible for the Employers to show immediate irreparable harm; therefore, it
is agreed that the court may enter a temporary injunction or restraining order
without the necessity of proof of immediate and irreparable harm to the Employers
and without the entry of any bond or security.


 


(b)                                 In any adjudication
for breach of the agreements in Section 5 and Section 6, the
prevailing party shall be paid the costs expenses and reasonable attorney’s
fees incident to any such adjudication by the other party as part of the judgement
of the court.


 


8.                                       Release of
the Employers and Related parties.


 


(a)                                  For, and in
consideration of the commitments made herein by the Employers, including
specifically the release in Section 9 below, the Executive, for himself
and for his heirs, successors and assigns, does hereby release completely and
forever discharge the Employers and their respective subsidiaries, affiliates,
stockholders, attorneys, officers, directors, agents, Executives, successors
and assigns, and any other party associated with the Employers (the “Released parties”),
to the fullest extent permitted by applicable law, from any and all claims,
rights, demands, actions, liabilities, obligations, causes of action of any and
all kinds, nature and character whatsoever, known or unknown, in any way
connected with his employment by the Employers or termination thereof; provided
that no such waiver shall be effective with respect to Executive=s rights related to the Consolidated
Omnibus Budget Reconciliation Act of 1985 (“COBRA”) or the Executive Retirement
Income Security Act of 1974 (“ERISA”).


 


(b)                                 The Executive
hereby specifically and unconditionally releases the Released parties from any
and all claims which the Executive may have against any of them and which arose
on or before the date of this Agreement under the Age Discrimination in
Employment Act (the “ADEA”), including, but not limited to, any claim
attributable to the Employers’ solicitation of the Executive’s consent to the
terms of this Agreement, and further acknowledges and represents that:


 


(i)                                     the Executive
waives the Executive’ claims under ADEA knowingly and voluntarily in exchange
for the commitments made herein by the Employers, and that the benefits provided
thereby constitute consideration of value to which the Executive would not
otherwise have been entitled;


 


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(ii)                                  the Executive
has been advised in writing by the Employers to consult an attorney in connection
with this Agreement;


 


(iii)                               the Executive
has been given a period of 21 days within which to consider the terms hereof;


 


(iv)                              the Executive
may revoke the waiver of ADEA claims set forth in this Section 8 for a
period of seven (7) days following the execution of this Agreement and the Executive’s
waiver of ADEA claims hereunder shall not become effective until the revocation
period has expired;


 


(v)                                 if the Executive
revokes the waiver of ADEA claims in accordance with subparagraph (iv) above,
the Executive shall cease to receive the payments and benefits specified in
Sections 3 and 4 hereof, but such revocation shall not be effective with
respect to the remainder of this Agreement and the consideration received by
the Executive prior to the revocation shall be valid and adequate consideration
with respect to the remainder of this Agreement; and


 


(vi)                              this
Agreement complies in all respects with Section 7(f) of ADEA, the waiver
provisions of the Older Workers Benefit Protection Act.


 


(c)                                  Notwithstanding
the foregoing, the Executive does not release the Employers from claims arising
out of any breach of this Agreement.


 


9.                                       General
Release of the Executive. 
For, and in consideration of the commitments made herein by the Executive,
including specifically the release in Section 8 above, the Employers, for
themselves, and for their respective successors and assigns do hereby release
completely and forever discharge the Executive and his heirs, successors and
assigns, to the fullest extent permitted by applicable law, from any and all
claims, rights, demands, actions, liabilities, obligations, causes of action of
any kinds, nature and character whatsoever, known or unknown, in any way
connected with the Executive’s position as an Executive, officer or director of
the Employers. Notwithstanding anything in the foregoing to the contrary, the
Employers do not release the Executive from claims arising out of any breach of
this Agreement.


 


10.                                 Representation.  The Employers and the Executive represent
that they have reviewed this Agreement, and that each of them is fully aware of
the content of this Agreement and of its legal effect, and acknowledge that
this is a legally valid and binding obligation of the parties.


 


11.                                 Withholding.  The Employers may make such provisions as
they deem appropriate for the withholding pursuant to federal or state income
tax laws of such amounts as the Employers determine they are required to
withhold in connection with the payments to be made pursuant to this Agreement.


 


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12.                                 Amendment
and Waiver. 
The terms of this Agreement may not be modified other than in a writing
signed by the parties.  No term or
condition of this Agreement shall be deemed to have been waived, nor shall
there be any estoppel against enforcement of any provision of this Agreement,
except by written instrument of the party charged with such waiver or
estoppel.  No such written waiver shall
be deemed a continuing waiver unless specifically stated therein, and each such
waiver shall operate only as to the specific term or condition for the future
or as to any act other than that specifically waived.


 


13.                                                                                 Notices.  All notices, demands, consents or other
communication required or permitted hereunder shall be in writing and shall be
deemed to have been given when: (i) personally delivered, or (ii) sent postage
prepaid by registered or certified mail, return receipt requested, such receipt
showing delivery to have been made, or (iii) sent overnight by prepaid receipt
courier addressed as follows:


 


If to the Executive:                                             Frederick
A. Marcell Jr.


1316 Larchmont Place


Mount Laurel, New Jersey  08054


 


If to the Employers:                                        Secretary


Willow Grove Bancorp, Inc.


Welsh and Norristown Roads


Maple Glen, Pennsylvania 19002-8030


 


Each party hereto shall promptly notify the
other of any change in address.


 


14.                                 Entire
Agreement.  This Agreement
incorporates the entire understanding among the parties relating to the subject
matter hereof, recites the sole consideration for the promises exchanged and
supersedes any prior agreements between the Employers and the Executive with
respect to the subject matter hereof.  In
reaching this Agreement, no party has relied upon any representation or promise
except those set forth herein.


 


15.                                 Invalid
Provisions: If any provision of this Agreement is
held to be illegal, invalid or unenforceable under present or future laws
effective during the term of this Agreement, such provision shall be fully
severable and this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its deletion from this Agreement.


 


16.                                 Bind and
Inure.  This Agreement
shall be binding upon and inure to the benefit of the Executive and the
Employers and their respective heirs and/or successors and permitted assigns.


 


17.                                 Governing
Law.  This Agreement
shall be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania, except to the extent that applicable federal law
preempts the laws of Commonwealth of Pennsylvania.


 


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IN WITNESS WHEREOF, the Company and the Bank
have caused this Agreement to be executed by their duly authorized
representatives and the Executive has executed this Agreement, all as of the
day and year first above written.


 


 


	
  WITNESSES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WILLOW GROVE BANCORP, INC.

  
	
   

  	
   

  	
   

  
	
  /s/ Mary R. Rossi

  	
   

  	
  By:

  	
  /s/ William W. Langan

  	
   

  
	
   

  	
   

  	
   

  	
  William W. Langan

  
	
   

  	
   

  	
   

  	
  Chairman of the Board

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WILLOW GROVE BANK

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Mary R. Rossi

  	
   

  	
  By:

  	
  /s/ William W. Langan

  	
   

  
	
   

  	
   

  	
   

  	
  William W. Langan

  
	
   

  	
   

  	
   

  	
  Chairman of the Board

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  FREDERICK A. MARCELL JR.

  
	
   

  	
   

  	
   

  
	
  /s/ Mary R. Rossi

  	
   

  	
   

  	
  /s/
  Frederick A. Marcell Jr.

  	
   

  



 


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