**Exhibit 10.13**

**CHANGE IN CONTROL SEVERANCEAGREEMENT**

THIS CHANGE INCONTROL SEVERANCE AGREEMENT (“Agreement”) entered into this 1st day of January, 2007 (“Effective Date”),by and between Third Federal Bank (the “Bank”) and Elizabeth Kaspern (the “Employee”).

WHEREAS, theEmployee is currently employed by the Bank as Senior Vice President and isexperienced in all phases of the business of the Bank; and

WHEREAS, theparties desire by this writing to set forth the rights and responsibilities ofthe Bank and Employee if the Bank should undergo a change in control (asdefined hereinafter in the Agreement) after the Effective Date.

NOW, THEREFORE, itis AGREED as follows:

1.             Employment.  The Employee is employed in the capacity asthe Senior Vice President.  The Employeeshall render such administrative and management services to the Bank and TFFinancial Corporation (“Parent”) as are currently rendered and as arecustomarily performed by persons situated in a similar executive capacity.  The Employee’s employment shall be for nodefinite period of time, and the Employee or the Bank may terminate suchemployment relationship at any time for any reason or no reason.  The employment at-will relationship remainsin full force and effect regardless of any statements to the contrary made bycompany personnel or set forth in any documents other than those explicitlymade to the contrary and signed by the President or the Chairman of the Bank.The Employee’s other duties shall be such as the President or the Board ofDirectors for the Bank (the “Board of Directors” or “Board”) may from time totime reasonably direct, including normal duties as an officer of the Bank.

2.             Term of Agreement.  The term of this Agreement shall be for theperiod commencing on the Effective Date and ending twenty-four (24) monthsthereafter.   Additionally, on, orbefore, each annual anniversary date from the Effective Date, the term of thisAgreement may be extended for an additional one year period beyond the theneffective expiration date upon a determination and resolution of the Board ofDirectors that the performance of the Employee has met the requirements andstandards of the Board, and that the term of such Agreement shall beextended.  This Agreement shall be deemedterminated upon the Employee’s termination of employment with the Bank, absenta Change in Control coincident with or prior to such termination of employment.

3.                                       Terminationof Employment in Connection with or Subsequent to a Change in Control.

(a)           Notwithstanding any provision hereinto the contrary, in the event of the involuntary termination of Employee’semployment under this Agreement, absent Just Cause, in connection with, orwithin one year following, any Change in Control of the Bank or Parent,Employee shall be paid an amount equal to two (2) times the prior (3) calendaryear (or lesser period if not employed for such 3 year period) average annualcompensation paid to the Employee by the Bank (whether said amounts werereceived or deferred by the Employee). In addition, Employee shall bereimbursed for the costs associated with maintaining coverage under the Bank’smedical and dental insurance reimbursement plans similar to that in effect onthe date of termination of employment, or similar plans provided for by theBank or its successor entity, for a period of one year thereafter.  Said sum shall be paid in one (1) lump sumon, or before the date of such date of termination of employment, and suchpayments shall be in lieu of any other future payments which the Employee wouldbe otherwise entitled to receive. Notwithstanding the forgoing, all sumspayable hereunder shall be reduced in such manner and to such extent so that nosuch payments made hereunder when aggregated with all other payments to be madeto the Employee by the Bank or the Parent shall be deemed an “excess parachutepayment” in accordance with Section 280G of the Internal Revenue Codes of 1986,as amended (the “Code”) and be subject to the excise tax provided at Section4999(a) of the Code. The term 

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“Change in Control”shall mean:  (i) the sale of all, ora material portion, of the assets of the Bank or the  Parent; (ii) the merger orrecapitalization of the Bank or the Parent whereby the Bank or the Parent isnot the surviving  entity; (iii) achange in control of the Bank or the Parent, as otherwise defined or determinedby the Office of Thrift Supervision or regulations promulgated by it; or(iv) the acquisition, directly or indirectly, of the beneficial ownership(within the meaning of that term as it is used in Section 13(d) of theSecurities Exchange Act of 1934 and the rules and regulations promulgatedthereunder) of twenty-five percent (25%) or more of the outstandingvoting securities of the Bank or the Parent by any person, trust, entity orgroup.  The term “person” means anindividual other than the Employee, or a corporation, partnership, trust,association, joint venture, pool, syndicate, sole proprietorship,unincorporated organization or any other form of entity not specifically listedherein.

(b)           Notwithstanding any other provisionof this Agreement to the contrary except as provided at Sections 4(b), 4(c),4(d), 4(e) and 5, Employee may voluntarily terminate his or her employmentunder this Agreement within one year following a Change in Control of the Bankor Parent, and Employee shall thereupon be entitled to receive the payment andbenefits described in Section 3(a) of this Agreement, upon the occurrence, orwithin ninety (90) days thereafter, of any of the following events, which havenot been consented to in advance by the Employee in writing: (i) if Employeewould be required to move his personal residence or perform his principalexecutive functions more than fifty (50) miles from the Employee’s primaryoffice as of the signing of this Agreement; (ii) if in the organizationalstructure of the Bank or Parent, Employee would be required to report to aperson or persons deemed to be at a management level below the management levelto which Employee was reporting to prior to the Change in Control; (iii) if theBank or Parent should fail to maintain the Employee’s base compensation ineffect as of the date of the Change in Control and existing employee benefitsplans, including material fringe benefit, stock option and retirement plans,except to the extent that such reduction in benefit programs is part of anoverall adjustment in benefits for all employees of the Bank or Parent and doesnot disproportionately adversely impact the Employee; (iv) if Employee would beassigned duties and responsibilities other than those normally associated withhis position as referenced at Section 1, herein, for a period of more than sixmonths; or (v) if Employee’s responsibilities or authority have in any way beenmaterially diminished or reduced for a period of more than six months.

4.             Other Changes in EmploymentStatus.

(a)           Except as provided for at Section 3,herein, the Board of Directors may terminate the Employee’s employment at anytime, but any termination by the Board of Directors other than termination forJust Cause, shall not prejudice the Employee’s right to compensation or otherbenefits under the Agreement.  ThisAgreement shall not be deemed to give the Employee any right to be retained inthe employment or service of the Bank, or to interfere with the right of theBank to terminate the employment of the Employee at any time.  The Employee shall have no right to receivecompensation or other benefits for any period after termination of employmentwith or without Just Cause, except as detailed herein.  Termination for “Just Cause” shall includetermination because of the Employee’s 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 finalcease-and-desist order, or material breach of any provision of the Agreement.

(b)           If the Employee is removed and/orpermanently prohibited from participating in the conduct of the Bank’s affairsby an order issued under Sections 8(e)(4) or 8(g)(1) of the Federal DepositInsurance Act (“FDIA”) (12 U.S.C. 1818(e)(4) and (g)(1)), all obligations ofthe Bank under this Agreement shall terminate, as of the effective date of theorder, but the vested rights of the parties shall not be affected.

(c)           If the Bank is in default (as definedin Section 3(x)(1) of FDIA) all obligations under this Agreement shallterminate as of the date of default, but this paragraph shall not affect anyvested rights of the contracting parties.

(d)           All obligations under this Agreementshall be terminated, except to the extent determined that continuation of thisAgreement is necessary for the continued operation of the Bank: (i) by theDirector of the Office of Thrift Supervision (“Director of OTS”), or his or herdesignee, at the time that the Federal Deposit Insurance 

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Corporation (“FDIC”)enters into an agreement to provide assistance to or on behalf of the Bankunder the authority contained in Section 13(c) of FDIA; or (ii) by the Directorof the OTS, or his or her designee, at the time that the Director of the OTS,or his or her designee approves a supervisory merger to resolve problemsrelated to operation of the Bank or when the Bank is determined by the Directorof the OTS to be in an unsafe or unsound condition.  Any rights of the parties that have alreadyvested, however, shall not be affected by such action.

(e)           Notwithstanding anything herein tothe contrary, any payments made to the Employee pursuant to the Agreement, orotherwise, shall be subject to and conditioned upon compliance with 12 USC§1828(k) and any regulations promulgated thereunder.

5.             Suspension of Employment .  If the Employee is suspended and/ortemporarily prohibited from participating in the conduct of the Bank’s affairsby a notice served under Section 8(e)(3) or (g)(1) of the FDIA (12 U.S.C.1818(e)(3) and (g)(1)), the Bank’s obligations under the Agreement shall besuspended as of the date of service, unless stayed by appropriateproceedings.  If the charges in thenotice are dismissed, the Bank shall, (i) pay the Employee all or part of thecompensation withheld while its contract obligations were suspended and (ii)reinstate any of its obligations which were suspended.

6.             Successors and Assigns.

(a)           This Agreement shall inure to thebenefit of and be binding upon any corporate or other successor of the Bankwhich shall acquire, directly or indirectly, by merger, consolidation, purchaseor otherwise, all or substantially all of the assets or stock of the Bank.

(b)           The Employee shall be precluded fromassigning or delegating his rights or duties hereunder without first obtainingthe written consent of the Bank.

7.             Amendments.       No amendments or additions to thisAgreement shall be binding upon the parties hereto unless made in writing andsigned by both parties, except as herein otherwise specifically provided.

8.             Applicable Law.   This agreement shall be governed by allrespects whether as to validity, construction, capacity, performance orotherwise, by the laws of the Commonwealth of Pennsylvania, except to theextent that Federal law shall be deemed to apply.

9.             Severability.          The provisions of this Agreement shallbe deemed severable and the invalidity or unenforceability of any provisionshall not affect the validity or enforceability of the other provisions hereof.

10.           Arbitration.  Any controversy or claim arising out of orrelating to this Agreement, or the breach thereof, shall be settled byarbitration in accordance with the rules then in effect of the district officeof the American Arbitration Association (“AAA”) nearest to the home office ofthe Bank, and judgment upon the award rendered may be entered in any courthaving jurisdiction thereof, except to the extent that the parties mayotherwise reach a mutual settlement of such issue.  The Bank shall incur the cost of all fees andexpenses associated with filing a request for arbitration with the AAA, whethersuch filing is made on behalf of the Bank or the Employee, and the costsand  administrative fees associated withemploying the arbitrator and related administrative expenses assessed by theAAA.  Each party shall be responsible forany fees incurred on its own behalf with respect to other expenses, includingattorneys’ fees, arising from such dispute, proceedings or actions.

11.           Confidentiality.

(a)           Employee agrees that, at all timeshereafter, he or she will keep all confidential and proprietary business andmarketing strategies of Bank and any and all other information which he or shelearned regarding the Bank during the course of his or her employment by Bank,in strictest confidence and will not disclose any part or aspect thereof toanyone for any reason unless required by law to do so.

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(b)           All marketing and business materials,existing or prospective customer lists or statements, seminar materials,drawings, designs, books, cards, records, accounts, audio visual reports,slides, files, notes, memoranda, and other papers, and any software, computerprograms, or data base information or any other information obtained from Bankor connected with or arising from any affairs of Bank or his or her employmenthereunder (the “Records”), in the charge or possession or knowledge of Employeeshall be and remain the exclusive property of Bank and shall not be used,transferred or disclosed in any way by Employee except in the ordinaryperformance of Employee’s duties for Bank while an employee of Bank.  Upon the termination of Employee’semployment, any and all Records of whatever kind and in whatever formmaintained, as well as all copies and reproductions thereof in the possessionor control of Employee shall be turned over and delivered by Employee to Bankwithout any hesitancy or delay.

12.           Compliance With Section 409A.  Notwithstanding anything herein to thecontrary, any payments to be made in accordance with this Agreement shall notbe made prior to the date that is 184 calendar days from the date of theEmployee’s termination of employment if it is determined by the Bank or theParent in good faith that such payments to be made to such Employee are subjectto the limitations at Section 409A of the Code and regulations promulgatedthereunder such that if the payments made in advance of such date would resultin the requirement for the Employee to pay additional interest and taxes to beimposed in accordance with Section 409A(a)(1)(B) of the Code.

13.           Entire Agreement.                This Agreement together with anyunderstanding or modifications thereof as agreed to in writing by the parties,shall constitute the entire agreement between the parties hereto.

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IN WITNESSWHEREOF, the parties have executed this Agreement on the date first hereinabovewritten.
|                              |   | THIRD FEDERAL BANK |
|------------------------------|--------|--------------------|
|                         |   |               |
|                         |   | By:                |
|                         |   |               |
|                         |   | Kent C. Lufkin     |
| ATTEST:                      |   |               |
|                         |   |               |
| Secretary                    |   |               |
|                         |   |               |
|                         |   |               |
| WITNESS:                     |   |               |
|                         |   |               |
|                         |   |               |
|                         |   |               |
| Elizabeth  Kaspern, Employee |   |               |

 

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