Exhibit 10.1
TERMINATION OF
EMPLOYMENT AGREEMENT
AND RELEASE
AGREEMENT
READ
IT CAREFULLY
NOTICE
TO DONNA M. COUGHEY
This
is a very important legal document, and you should carefully review
and understand the terms and effect of this document before signing
it. By signing this Acknowledgement and Release
(“Agreement”), you are agreeing to completely release
Willow Financial Bancorp, Inc., Willow Financial Bank,
Harleysville National Corporation, Harleysville National Bank and
Trust, and their subsidiaries, affiliates, directors and
officers. Therefore, you should consult with an attorney
before signing this Agreement. You have twenty-one (21) days
from the day of receipt of this document to consider the Agreement.
The twenty-one (21) days will begin to run on the day after
receipt. If you choose to sign the Agreement, you will have
an additional seven (7) days following the date of your
signature to revoke the Agreement, and the Agreement shall not
become effective or enforceable until the revocation period has
expired.
This Termination
of Employment Agreement and Release Agreement (the “Release
Agreement”) is entered into as of May 20, 2008, by and
among Willow Financial Bancorp, Inc. (“WFB”),
Willow Financial Bank (“WFB Bank”), Harleysville
National Corporation (“HNC”), Harleysville National
Bank and Trust (“HNC Bank”) and each of their
subsidiaries and affiliates, and Donna M. Coughey
(“Executive”).
WHEREAS,
Executive, WFB and WFB Bank entered into an employment agreement
dated July 15, 2005 and amended on October 23, 2007
(“WFB Employment Agreement”);
WHEREAS, HNC and
WFB will enter into an Agreement and Plan of Merger dated
May 20, 2008 (“Merger Agreement”) pursuant to
which WFB shall merge with and into HNC (the
“Merger”);
WHEREAS, pursuant
to the Merger Agreement, WFB has agreed to make the payments set
forth herein in exchange for the termination of the WFB Employment
Agreement on the Effective Date (as defined in the Merger
Agreement), and in exchange for the execution of this Release
Agreement and an employment agreement between Harleysville
Management Services, Inc. (“HMS”) and Executive
(“HMS Employment Agreement”);
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WHEREAS, HNC is
only willing to enter into the Merger Agreement on the condition
that Executive provides the inducements set forth in this Agreement
by executing this Release Agreement and entering into the HMS
Employment Agreement.
NOW THEREFORE, in
consideration of the foregoing and other good and valuable
consideration the receipt and sufficiency of which is hereby
acknowledged, and intending to be legally bound, it is agreed as
follows:
1.
Termination of WFB Employment Agreement . Executive,
HNC, HNC Bank, HMS, WFB, and WFB Bank hereby mutually agree that
the WFB Employment Agreement shall terminate and be cancelled
absolutely at the Effective Time of the Merger, as defined in the
Merger Agreement. At the time that the WFB Employment
Agreement terminates, neither Executive nor WFB or WFB Bank nor
their successors shall have any further rights or obligations under
the WFB Employment Agreement.
2.
Consideration .
(a)
On the Effective Date of the Merger, as defined in the Merger
Agreement, in full satisfaction of the benefits that would
otherwise be payable under the WFB Employment Agreement and in
consideration of signing this Release Agreement, WFB shall pay
Executive a lump sum payment in the amount of $1,540,960,
representing $1,500,000 cash severance and $40,960 in lieu of
continued benefits (other than the benefits provided in
Section 2(b) below).
(b)
HNC and HNC Bank shall provide Executive, her spouse and any
dependents covered as of the Effective Date of the Merger for a
period ending at the earlier of (i) three years subsequent to
the Effective Date of the Merger or (ii) the date of
Executive’s full-time employment by another employer
(provided that Executive, her spouse and/or dependents is entitled
under the terms of such employment to substantially similar
benefits as those described in this section), at no cost to
Executive, continued participation in the life, disability,
health and dental insurance plans and any other group insurance
plans offered by HNC and HNC Bank to their employees, with any
insurance premiums payable by HNC or HNC Bank pursuant to this
Section 2(b) to be payable at such times and in such
amounts as if Executive was still an employee of HNC and HNC Bank,
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 HNC and HNC Bank in any taxable year shall not affect
the amount of insurance premiums required to be paid by them in any
other taxable year; provided that if the participation of Executive
or other covered dependents in any of the life, disability, health,
dental and other insurance plans is barred, then HNC and HNC Bank
shall either arrange to provide such persons with insurance
benefits substantially similar to those which Executive and other
covered persons were otherwise entitled to receive or, if such
coverage cannot be obtained, pay a lump sum cash equivalency amount
within thirty (30) days following the date coverage ceases based on
the annualized rate of premiums being paid by HNC and HNC Bank as
of such date.
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3.
Release and Waiver .
(a)
Executive hereby agrees that the payments will be in full
satisfaction of all obligations of HNC, HMS, HNC Bank, WFB, and WFB
Bank and any of their subsidiaries under the WFB Employment
Agreement.
(b)
Executive, on behalf of herself, her heirs and assigns, irrevocably
and unconditionally releases HNC, HNC Bank, HMS, WFB, and WFB Bank
and their respective predecessors, successors, affiliates,
subsidiaries, parents, partners, shareholders, directors, officers,
agents, employees, attorneys, and all other persons or entities who
could be said to be jointly or severally liable with them from all
claims, controversies, liabilities, demands, causes of action,
debts, obligations, promises, acts, agreements, and damages of
whatever kind or nature, whether known or unknown, suspected or
unsuspected, foreseen or unforeseen, liquidated or contingent,
related to Executive’s employment, termination of employment,
WFB Employment Agreement or termination thereof, including but not
limited to, any and all claims for breach of express or implied
contract or covenant of good faith and fair dealing (whether
written or oral), all claims for retaliation or violation of public
policy, breach of promise, detrimental reliance or tort (e.g.
intentional infliction of emotional distress, defamation, wrongful
termination, interference with contractual or advantageous
relationship, etc), whether based on common law or otherwise; all
claims arising under Title VII of the Civil Rights Act of 1964, as
amended; the Age Discrimination in Employment Act; the Federal
Older Workers Benefit Protection Act, the Family and Medical Leave
Act, any Whistleblower provision of any statute or law, the
Americans with Disabilities Act; the Employee Retirement Income
Security Act of 1974, any other statute, regulation or law or
amendments thereto, claims for emotional distress, mental anguish,
personal injury, loss of consortiu
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