Exhibit 10.8

 

FOX CHASE BANK

EMPLOYEE SEVERANCE COMPENSATION PLAN

(as amended and restated effective January 1, 2012)

 

1.                                      Effective Date

 

The Fox Chase Bank Employee Severance Compensation Plan was originally approved by the Board of Directors of Fox Chase Bank (the “Bank”) as a general severance policy for all eligible employees effective October 5, 2005.  The policy was later approved by the Office of Thrift Supervision in connection with the Bank’s mutual holding company reorganization and amended and restated in its entirety into the Fox Chase Bank Employee Severance Compensation Plan.  Effective January 1, 2012, the Fox Chase Bank Employee Severance Compensation Plan was subsequently amended and restated in its entirety (the “Plan”) to reflect the Bank’s second step conversion and clarify certain terms and conditions of the Plan.

 

2.                                      Purpose

 

The purpose of this Plan is to:  (a) provide management with guidelines to ensure fair and consistent treatment of Employees when employment is terminated by the Bank for any reason other than Termination for Cause or a Change in Control; and (b) to assure the Bank of the services of Covered Employees in the event of a Change in Control by providing Covered Employees who are terminated voluntarily or involuntarily within one (1) year of a Change in Control with severance benefits.  For purposes of paragraphs 4(a) and 4(b) hereof, this Plan is intended solely as a guideline for management and is not intended as a contractual commitment on the part of the Bank to any Employee.  Unless otherwise stated, all capitalized terms noted herein are defined in Section 3 of this Plan.

 

3.                                      Definitions

 

a.                                      “Base Compensation” means and includes all regular weekly cash wages or weekly salary, but excludes bonuses, commissions and any other compensation, if any, paid or accrued as consideration for an Employee’s service to the Bank.  Notwithstanding the foregoing, for purposes of Employees paid solely on a commission basis, “Base Compensation” shall include commissions earned up to $50,000 per annum.  In the case of an hourly Employee or a part-time Employee, “Base Compensation” shall be determined by reference to compensation earned during the Employee’s average weekly work schedule during the 30 days preceding the termination date.

 

b.                                      “Change in Control” means the occurrence of one of the following events:

 

(a)                                 Merger:  The Company merges into or consolidates with another entity, or merges another entity into the Company and, as a result, less than a

 











 

majority of the combined voting power of the resulting entity immediately after the merger or consolidation is held by persons who were stockholders of the Company immediately before the merger or consolidation;

 

(b)                                 Change in Board Composition:  During any period of two consecutive years, individuals who constitute the Company’s Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of the Board; provided, however, that for purposes of this clause (b) each director who is first elected by the Board (or first nominated by the Board for election by stockholders) by a vote of at least two-thirds (2/3) of the directors who were directors at the beginning of the two-year period shall be deemed to have also been a director at the beginning of the two-year period; or

 

(c)                                  Acquisition of Significant Share Ownership:  There is filed, or required to be filed, a report on Schedule 13D or another form or schedule (other than Schedule 13G) required under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner(s) of 25% or more of a class of the Company’s voting securities, however this clause (c) shall not apply to beneficial ownership of Company voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns 50% or more of its outstanding voting securities.

 

(d)                                 Sale of Assets: The Company sells to a third party all or substantially all of its assets.

 

c.                                       “Comparable Position” shall mean a position that would (i) provide a Covered Employee with Base Compensation that is comparable to those provided to the Covered Employee prior to the Change in Control; (ii) be in a location that would be more than thirty (30) miles from the Employee’s place of employment at the Bank or Company immediately prior to the Change in Control; and (iii) have job skill requirements and duties that are comparable to the requirements and duties of the position held by the Covered Employee prior to the Change in Control.

 

d.                                      “Company” means Fox Chase Bancorp, Inc., a Maryland corporation.

 

e.                                       “Covered Employee” means any full-time or part-time employee of the Bank or any subsidiary of the Bank that has worked at least one (1) year with the Bank or subsidiary as of his or her termination date.

 

f.                                        “Employee” means any full-time or part-time employee of the Bank or any subsidiary of the Bank; provided, however, that any individual who is covered or

 

2











 

hereinafter becomes covered by an employment contract shall not be considered to be an “Employee” for purposes of this Plan.

 

g.                                       “Termination for Cause” shall include termination because of an Employee’s personal dishonesty, incompetence, willful misconduct, any 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 Employee’s personal violation of any final cease-and desist order.  In determining incompetence, the acts or omissions shall be measured against standards generally prevailing in the financial services industry.

 

h.                                      “Year of Service” means each 12-month period of service following an Employee’s date of hire.  The taking of a leave of absence shall not eliminate a period of time from being a Year of Service if the period of time otherwise qualifies as a Year of Service.  A “leave of absence” means (i) the taking of an authorized or approved leave of absence under the provisions of the federal Family and Medical Leave Act (“FMLA”), (ii) any state law providing qualitatively similar benefits as the FMLA, or (iii) a leave of absence authorized under the policies of the Bank.

 

4.                                      Amount of Payment

 

a.                                      Unless otherwise determined by the Board of Directors of the Bank, an Employee whose employment with the Bank is terminated by the Bank for reasons other than Termination for Cause or Change in Control will be eligible to receive a termination benefit from the Bank equal to the product of (i) two weeks of Base Compensation in effect as of the Employee’s termination date and (ii) the Employee’s Years of Service (including partial years). In no event shall an Employee receive a cash payment less than four (4) weeks Base Compensation.

 

b.                                      Unless otherwise determined by the Board of Directors of the Bank, in addition to any payment authorized under paragraph (a) above, an Employee who receives a benefit under this Plan will also be eligible to receive a lump sum cash payment equal to three (3) months of the cost of the employer portion of an Employee’s COBRA health benefits (“COBRA Payment”); provided, however, that only those Employees participating in the Bank’s medical benefits programs prior to their termination of employment will qualify for a COBRA Payment.  An Employee will receive his or her COBRA payment as soon as practical following the Bank’s receipt of written confirmation that the Employee has applied for COBRA.

 

c.                                       Notwithstanding anything herein to the contrary, the maximum benefit payable to an Employee paid under this Plan, including Bank-paid COBRA Benefits, as applicable, shall not exceed an amount equal to fifty-two weeks of Base Compensation, less one dollar.

 

3











 

d.                                      Any Employee whose employment is terminated as a result of a Termination for Cause shall receive no benefits under this Plan.

 

4











 

5.                                      Change in Control Severance Benefits

 

a.                                      Eligibility.  Covered Employees shall be eligible to receive a Change in Control Severance Benefit (as defined below) if, within the period beginning on the effective date of a Change in Control and ending on the first anniversary date of such date, (i) the Covered Employee’s employment with the Bank is involuntarily terminated or (ii) the Covered Employee terminates employment with the Bank voluntarily after being offered continued employment in a position that is not a Comparable Position.  No Covered Employee shall be eligible for a Change in Control Severance Benefit: (i) in connection with a Termination for Cause; (ii) if he or she is offered a Comparable Position within the Bank and declines to accept such position; or (iii) if the Covered Employee, at the time of termination or employment, is a party to a Change in Control Agreement or Employment Agreement with the Bank or the Company.

 

b.                                      Change in Control Severance Benefit.  Any Covered Employee who becomes entitled to receive a Change in Control Severance Benefit payment under this Plan shall receive a cash payment equal to the product of (i) two weeks of Base Compensation and (ii) the Covered Employee’s Years of Service (including partial years), plus a lump sum cash payment equal to three (3) months of the cost of the employer portion of an Employee’s COBRA health benefits (“COBRA Change in Control Payment”); provided, however, that only those Employees participating in the Bank’s medical benefits programs prior to their termination of employment will qualify for a COBRA Change in Control Payment.  In no event shall any Covered Employee receive a cash payment less than four (4) weeks Base Compensation.  Notwithstanding anything herein to the contrary, the maximum benefit payable to an Employee paid under this Plan, including the COBRA Change in Control Payment, as applicable, shall not exceed an amount equal to fifty-two weeks of Base Compensation, less one dollar.

 

6.                                      Other Benefits Not Affected

 

This Plan does not affect other benefits, such as payment for accrued and unused paid time off, and other such benefits that are offered to Employees of the Bank from time to time.

 

7.                                      Employment Status

 

This Plan does not constitute a contract of employment or impose on the Employee or the Bank any obligation to retain the services of Employees, to change the status of employment, or to change the Bank’s policies regarding termination of employment.

 

8.                                     Amendment or Termination

 

This Plan may be amended, suspended or terminated at any time by a written resolution of the Board of Directors of the Bank, in its sole discretion.  Except however, with respect to the

 

5











 

Change in Control Severance Benefits provided under this Plan, paragraph 5 of the Plan may not be amended or terminated if a Change in Control has occurred.

 

9.                                      Miscellaneous

 

a.                                      All payments will be subject to customary withholding for federal, state and local tax purposes.

 

b.                                      This Plan is administered by the Board of Directors of the Bank, which shall have the discretion to interpret the terms of the plan and to make all determinations about eligibility and payments of benefits.  All decisions of the Board of Directors of the Bank are conclusive and binding on all persons.  The Board of Directors may delegate and reallocate any authority and responsibility with respect to the Plan.

 

c.                                       All amounts payable under the Plan will be paid from the general funds of the Bank; no separate fund will be established under the Plan; and the Plan will have no assets.

 

d.                                      Notwithstanding anything in this Plan to the contrary, if a Change in Control Benefit that is otherwise payable to an Employee who is a “disqualified individual” would constitute an “excess parachute payment,” taking into account payments under this Plan and otherwise, then the benefit payable under this Plan shall be reduced to the maximum amount which does not include an excess parachute payment.  The terms “disqualified individual” and “excess parachute payment” shall have the same meanings as under Section 280G of the Code.

 

10.                               Required Provisions

 

a.                                      In the event any of the provisions of this paragraph 10 are in conflict with the terms of this Plan, this paragraph 10 shall prevail.

 

b.                                      The Bank may terminate an Employee’s employment at any time, but any termination by the Bank, other than Termination for Cause, shall not prejudice the Employee’s right to compensation or other benefits under this Plan.  An Employee shall not have the right to receive compensation or other benefits for any period after Termination for Cause.

 

c.                                       If an Employee is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank’s affairs by a notice served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(3) or (g)(1); the Bank’s obligations under this Plan shall be suspended as of the date of service, unless stayed by appropriate proceedings.  If the charges in the notice are dismissed, the Bank may in its discretion:  (i) pay the Employee all or part of the compensation withheld while their contract obligations were

 

6











 

suspended; and (ii) reinstate (in whole or in part) any of the obligations which were suspended.

 

d.                                      If an Employee is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issued under Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(4) or (g)(1), all obligations of the Bank under this Plan shall terminate as of the effective date of the order, but vested rights of the Plan participants shall not be affected.

 

e.                                       If the Bank is in default as defined in Section 3(x)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1813(x)(1), all obligations of the Bank under this Plan shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the Plan participants.

 

f.                                        All obligations under this Plan shall be terminated, except to the extent determined that continuation of the Plan is necessary for the continued operation of the Bank: (i) by the Director of the Comptroller of the Currency (the “Comptroller”) (or his designee), at the time the Federal Deposit Insurance Corporation (“FDIC”) or the Resolution Trust Corporation enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. §1823(c); or (ii) by the Director of the OCC (or his designee) at the time the Director (or his designee) approves a supervisory merger to resolve problems related to the operations of the Bank or when the Bank is determined by the Director to be in an unsafe or unsound condition.  Any rights of the participants that have already vested, however, shall not be affected by such action.

 

g.                                       Any payments made to Employees pursuant to this policy, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

 

 

	
Attest:
    	
 
    	
FOX   CHASE BANK
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/   JERRY D. HOLBROOK
    	
 
    	
 
    	
By:
    	
/s/   THOMAS M. PETRO
    
	
Secretary
    	
 
    	
 
    	
Thomas   M. Petro
    
	
 
    	
 
    	
 
    	
President   and Chief Executive Officer
    


 

7