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Exhibit 10.2
SEVERANCE AGREEMENT
This AGREEMENT is made and entered into this 26th day of October,
1999,
by and among PVF Capital Corp. (the "Corporation"), a corporation
organized
under the laws of the State of Ohio, Park View Federal Savings Bank
(the
"Bank"), an OTS-chartered, FDIC-insured savings association with
its main office
located in Cleveland, Ohio and C. Keith Swaney (the "Executive").
Any reference
to the "Board of Directors" herein shall mean the Board of
Directors of the
Corporation or the Bank or a committee serving at the pleasure of
the Board of
Directors of the Bank. Any reference to "FDIC" herein shall mean
the Federal
Deposit Insurance Corporation. Any reference to "OTS" shall mean
the Office of
Thrift Supervision.
WHEREAS, the Executive serves as an employee of the Bank;
WHEREAS, the Corporation, the Bank and the Executive are parties to
a
Severance Agreement dated July 1, 1998; and
WHEREAS, the parties hereto desire that this Agreement supersede
and
replace in its entirety the July 1, 1998 Severance Agreement;
NOW THEREFORE, in consideration of the performance of the
responsibilities of the Executive and upon the other terms and
conditions
hereinafter provided, the parties hereto agree as follows:
1. NO
EMPLOYMENT CONTRACT
The parties hereto acknowledge and agree that this Agreement is not
a
management or employment agreement and that nothing in this
Agreement shall give
the Executive any rights or impose any obligations to continued
employment by
the Bank or Corporation or any subsidiary or successor of the Bank
or
Corporation, nor shall it give the Bank or Corporation any rights
or impose any
obligations for the continued performance of duties by the
Executive for the
Bank or Corporation or any subsidiary or successor of the Bank or
Corporation.
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2. TERM
OF AGREEMENT
The initial term of this Agreement shall be for a period of three
(3)
years commencing November 1st, 1999 (hereafter referred to as the
"Anniversary
Date"). Commencing on the first Anniversary Date of this Agreement,
and
continuing at each Anniversary Date thereafter, the Agreement
shall
automatically renew for one (1) additional year beyond the then
effective
expiration date only upon a determination and resolution of the
Board of
Directors that the performance of the Executive has met the
requirements and
standards of the Board and that such term shall be extended. If the
Board of
Directors determines not to extend the term, it shall promptly so
notify the
Executive, with such election by the Board not to extend the term
not to
otherwise affect the then effective term of this Agreement.
Reference herein to
the term of this Agreement shall refer both to such initial term
and such
extended terms. Unless sooner terminated as set forth herein, this
contract
shall terminate when the Executive reaches age sixty-five (65).
3.
TERMINATION FOR CAUSE
If the Corporation or Bank terminates the Executive's employment
for
cause (as defined below), all of the Bank's and Corporation's
obligations
hereunder shall immediately terminate as of the termination date.
For purposes
of this Agreement, termination "for cause" shall mean only the
following events:
(i) personal dishonesty; (ii) incompetence; (iii) material breach
of any
provision of this Agreement; (iv) breach of fiduciary duty
involving personal
profit; (v) intentional failure to perform stated duties; (vi) a
material breach
of the reasonable policies and procedures for the operation of the
Bank provided
to the Executive by formal action of the Bank's Board of Directors;
(vii)
willful violation of any law, rule, regulation (other than a law,
rule or
regulation relating to a traffic violation or similar offense) or
final
cease-and-desist order; or (viii) willful misconduct.
4.
VOLUNTARY TERMINATION OF AGREEMENT
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This Agreement may be terminated by the Executive at any time
upon
ninety (90) days' written notice to either the Bank or the
Corporation or upon
such shorter period as may be agreed upon between the Executive and
the Board of
Directors.
5.
GOVERNMENTAL TERMINATION OF AGREEMENT
(a) If the Executive is removed from office and/or permanently
prohibited from participating in the conduct of the Bank's or the
Corporation's
affairs by an order issued under Section 8(e) of the Federal
Deposit Insurance
Act, 12 U.S.C. Section 1818(e), all obligations of the Bank and the
Corporation
under this Agreement shall terminate, as of the effective date of
the order.
(b) If the Bank is in default (as defined in Section 3(x)(1) of
the
Federal Deposit Insurance Act), all obligations under this
Agreement shall
terminate.
(c) All obligations under this Agreement shall be terminated,
except to
the extent determined that continuation of the contract is
necessary for the
continued operation of the Bank, by the Director of the OTS or his
or her
designee at the time the 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
Federal Deposit Insurance Act, or by the Director of the OTS or his
or her
designee at the time the Director of the OTS or his or her designee
approves a
supervisory merger to resolve problems related to the operation of
the Bank or
when the Bank is determined by the Director of the OTS to be in an
unsafe or
unsound condition. Any rights of the parties that have already
vested, however,
shall not be affected by such action.
(d) If the Executive is suspended and/or temporarily prohibited
from
participating in the conduct of the Bank's affairs by a notice
served under
Section 8(e)(3) or (g)(1) of the Federal Deposit Insurance Act, 12
U.S.C.
Section 1818(e)(3) or (g)(1), the Corporation's and the Bank's
obligations under
subparagraphs 6(a),
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(b) and (c) of this Agreement shall be suspended as the date of
service, unless
stayed by appropriate proceedings.
(e) If the charges in the notice referenced in subparagraph 5(d)
are
dismissed, the Board of Directors may in its discretion:
(i) pay the
Executive all or part of the severance benefits while
the Corporation's and the Bank's contract obligations were
suspended, and
(ii)
reinstate (in whole or in part) any of the Corporation's and
the Bank's obligations which were suspended as required in
subparagraph (d) above.
6.
SEVERANCE PAYMENTS OR TERMINATION BENEFITS
For purpose of this Agreement, the severance payments and
termination
benefits specified in this Paragraph 6 shall be payable to the
Executive
subsequent to the occurrence of one of the following events:
(i)
Involuntary termination of the Executive's employment with the
Bank or Corporation with or within one (1) year after a Change
in Control, other than for Cause or pursuant to Paragraphs 4
or 5 of this Agreement. For purposes of this section, Change
in Control shall have the same meaning as such term is defined
in Paragraph 8, and Cause shall have the same meaning as such
term is defined in Paragraph 3.
(ii)
Voluntary or involuntary termination for Good Reason, as
defined in Paragraph 7, and other than for Cause or pursuant
to Paragraphs 4 or 5 of this Agreement.
(a) Upon the Executive's termination as a result of one of the
events
specified in this Paragraph 6, the Bank or Corporation shall pay to
Executive,
or in the event of his subsequent death, his beneficiary or
beneficiaries, or
his estate as the case may be, as severance pay or liquidated
damages, or both,
a sum equal to two times the Executive's annual compensation. For
purposes of
this Paragraph, compensation shall be defined as the Executive's
then current
base salary, plus annual incentive compensation for the calendar
year
immediately preceding the year in which the above-mentioned event
occurs. Such
payment
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shall be paid to the Executive in a lump sum within thirty (30)
days of the
Executive's date of termination. The amount payable to the
Executive hereunder
shall not be reduced to account for the time value of money or
discounted to
present value.
(b) Upon the Executive's termination as a result of one of the
events
specified in this Paragraph 6, the Bank or Corporation shall cause
the Executive
to become fully vested in any qualified and/or nonqualified plans,
programs or
arrangements in which the Executive participated, notwithstanding
any provisions
contained in the respective Agreement of the plan, program or
arrangement. The
Bank shall also contribute to the Executive's 401(k) Plan Account
the Bank's
matching and/or profit sharing which would have been paid had the
Executive
remained in the employ of the Bank throughout the remainder of the
401(k) Plan
year.
(c) Upon the Executive's termination as a result of one of the
events
specified in this Paragraph 6, the Corporation or Bank will cause
to be
continued life, health and disability insurance coverage
substantially identical
to the coverage maintained by the Bank or the Corporation for the
Executive
prior to his severance. Such coverage shall cease upon the earlier
of
Executive's employment by another employer or twelve (12) months
from such
termination. Upon the expiration of the twelve (12) month period,
Executive
shall have the option of continuing health insurance coverage at
his/her own
expense for a period not less than the number of months by which
the
Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation
period
exceeds twelve (12) months.
(d) The Executive shall not be required to mitigate the amount of
any
payment required hereunder by seeking other employment or otherwise
nor shall
the amount paid hereunder be reduced or offset by any compensation
earned or
received by the Executive as a result of employment with another
employer or
self- employment. The amount paid hereunder shall not be reduced by
any other
plan, program, policy
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or arrangement of the Bank or Corporation. Benefits provided under
Paragraph
6(c) shall be reduced to the extent comparable benefits are
actually received by
the Executive from or through another employer.
7. GOOD REASON
For purposes of this Agreement, "Good Reason" means the occurrence
of
any of the events or conditions described in subparagraphs (a)
through (f)
hereof without the Executive's express written consent; provided
the Executive's
right to terminate his employment pursuant to this Paragraph 7
shall not be
affected by his incapacity due to physical or mental illness.
(a) A change
in the Executive's status, title, position or
responsibilities (including reporting responsibilities) which,
in the Executive's reasonable judgment, does not represent a
promotion from his status, title, position or responsibilities
as in effect immediately prior thereto; the assignment to the
Executive of any duties or responsibilities which, in the
Executive's reasonable judgment, are inconsistent with such
status, title, position or responsibilities; or any removal of
the Executive from or failure to reappoint him to any of such
positions, except in connection with the termination of his
employment for (i) Cause, (ii) pursuant to Paragraphs 4 or 5,
(iii) by the Executive other than for Good Reason;
(b) A material
reduction by the Bank or the Corporation in the
Executive's base salary;
(c) The
relocation of Executive's principal place of employment to
a location that is more than thirty-five (35) miles from the
location where Executive was principally employed immediately
prior to such relocation or the Bank's or the Corporation's
requiring the Executive to be based at any place other than
the location where the Executive was based immediately prior
to such change, except for reasonably required travel (as
determined by the Board of Directors) on the Bank's or the
Corporation's business;
(d) The
failure by the Bank or the Corporation to continue to
provide the Executive with benefits substantially similar to
those provided to him under any of the employee benefit plans
in which the Executive becomes a participant, or the taking of
any action by the Bank or the Corporation which would directly
or indirectly materially reduce any of such benefits or
deprive the Executive of any material fringe benefit enjoyed
by him;
(e) Death
prior to retirement. If the Executive dies while
active
