Exhibit 10.1
EMPLOYMENT AGREEMENT
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THIS AGREEMENT is entered into as of the 15th day of August, 2000, by and
between Hopkinsville Federal Savings Bank (the "Bank") and Michael L. Woolfolk
(the "Employee").
WHEREAS, the Bank desires to employ the Employee; and
WHEREAS, the Employee is willing to commence employment with the Bank on
the terms and conditions set forth below, and the Board of Directors of the Bank
has determined that such terms and conditions are reasonable and in the best
interests of the Bank.
NOW, THEREFORE, it is AGREED as follows:
1. Employment. The Employee is hereby employed by the Bank. The Employee
shall serve as Executive Vice President and Chief Operations Officer of the
Bank. Except to the extent that the President and Chief Executive Officer of the
Bank shall have delegated a portion of such authority to one or more other
officers, the Employee shall provide general supervision of the operations of
the Bank to insure that assigned duties and responsibilities are carried out and
shall perform such other administrative and management services for the Bank as
are currently rendered and as are customarily performed by persons situated in a
similar executive capacity. The Employee shall also promote, by entertainment or
otherwise, as and to the extent permitted by law, the business of the Bank.
2. Base Compensation. The Bank agrees to pay the Employee as Executive Vice
President and Chief Operations Officer during the term of this Agreement a
salary (the "Base Salary") at the rate of $72,000 per annum, payable in cash not
less frequently than monthly. The Board shall review, not less often than
annually, the rate of the Employee's Base Salary, and in its sole discretion may
decide to increase his Base Salary.
3. Discretionary Bonuses. The Employee shall participate in an equitable
manner with all other senior management employees of the Bank in discretionary
bonuses that the Board of Directors of the Bank ("Board") may award from time to
time to the Bank's senior management employees. No other compensation provided
for in this Agreement shall be deemed a substitute for the Employee's right to
participate in such discretionary bonuses.
4. (a) Participation in Retirement, Medical and Other Plans. The Employee
shall be entitled to participate in any plan that the Bank maintains for the
benefit of its employees if the plan relates to (i) pension, profit-sharing, or
other retirement benefits, (ii) medical insurance or the reimbursement of
medical or dependent care expenses, or (iii) other group benefits, including
disability and life insurance plans.
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(b) Employee Benefits. The Employee shall participate in any fringe
benefits that are or may become available to the Bank's senior management
employees, including, for example: any stock option or incentive compensation
plans and any other benefits that are commensurate with the responsibilities and
functions to be performed by the Employee under this Agreement.
(c) Expenses. The Employee shall be reimbursed for all reasonable
out-of-pocket business expenses that he shall incur in connection with his
services under this Agreement upon substantiation of such expenses in accordance
with the policies of the Bank.
(d) Relocation Expenses. The Bank shall assist the Employee with reasonable
expenses incurred in moving furniture, normal household goods and personal
belongings to Hopkinsville, Kentucky. Some or all of such relocation expenses
may be taxable income to the Employee.
5. Term. The Bank hereby employs the Employee, and the Employee hereby
accepts such employment under this Agreement, for the period commencing on the
date hereof and ending 36 months thereafter (or such earlier date as is
determined in accordance with Section 9 hereof). Not more than 24 months from
the date hereof, the Board shall meet to review the Employee's performance and
shall determine in a duly adopted resolution whether the performance of the
Employee has met the Board's requirements and standards and whether this
Agreement shall be extended.
6. Loyalty, Full Time and Attention.
(a) During the period of his employment hereunder and except for illness,
reasonable vacation periods, and reasonable leaves of absence, the Employee
shall devote all his full business time, attention, skill, and efforts to the
faithful performance of his duties hereunder; provided that, from time to time,
the Employee may serve on the board of directors of, and hold any other offices
or positions in, companies or organizations, that will not present any conflict
of interest with the Bank or any of its subsidiaries or affiliates, or
unfavorably affect the performance of Employee's duties pursuant to this
Agreement, or will not violate any applicable statute or regulation. "Full
business time" is hereby defined as that amount of time usually devoted to like
companies by similarly situated executive officers. During the term of his
employment under this Agreement, the Employee shall not engage in any business
or activity contrary to the business affairs or interests of the Bank, or be
gainfully employed in any other position or job other than as provided above.
(b) Nothing contained in this Section 6 shall be deemed to prevent or limit
the Employee's right to invest in the capital stock or other securities of any
business dissimilar from that of the Bank, or, solely as a passive or minority
investor, in any business.
7. Standards. The Employee shall perform his duties under this Agreement in
accordance with such reasonable standards as the Board may establish from time
to time. The
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Bank will provide the Employee with the working facilities and staff customary
for similar executive officers and necessary for him to perform his duties.
8. Vacation and Sick Leave. The Employee shall be entitled, without loss of
pay, to absent himself voluntarily from the performance of his duties under this
Agreement in accordance with the terms set forth below, all such voluntary
absences to count as vacation time; provided that:
(a) The Employee shall be entitled to an annual vacation in accordance with
the policies periodically established by the Board for senior management
employees of the Bank.
(b) The Employee shall not receive any additional compensation from the
Bank on account of his failure to take a vacation, and the Employee shall not
accumulate unused vacation from one fiscal year to the next, except in either
case to the extent authorized by the Board.
(c) In addition to the aforesaid paid vacations, the Employee shall be
entitled, without loss of pay, to absent himself voluntarily from the
performance of his employment obligations with the Bank for such additional
periods of time and for such valid and legitimate reasons as the Board may in
its discretion approve. Further, the Board may grant to the Employee a leave or
leaves of absence, with or without pay, at such time or times and upon such
terms and conditions as the Board in its discretion may determine.
(d) In addition, the Employee shall be entitled to an annual sick leave
benefit as established by the Board.
9. Termination and Termination Pay. The Employee's employment hereunder may
be terminated under the following circumstances:
(a) Death. The Employee's employment under this Agreement shall terminate
upon his death during the term of this Agreement, in which event the Employee's
estate shall be entitled to receive the compensation due the Employee through
the last day of the calendar month in which his death occurred.
(b) Disability. The Bank may terminate the Employee's employment after
having established, through a determination by the Board, the Employee's
Disability. For purposes of this Agreement, "Disability" means a physical or
mental infirmity that impairs the Employee's ability to substantially perform
his duties under this Agreement and that results in the Employee becoming
eligible for long-term disability benefits under the Bank's long-term disability
plan (or, if the Bank has no such plan in effect, that impairs the Employee's
ability to substantially perform his duties under this Agreement for a period of
180 consecutive days). The Employee shall be entitled to the compensation and
benefits provided for under this Agreement for (i) any period during the term of
this Agreement and prior to the establishment of the Employee's Disability
during which the Employee is unable to work due to the physical
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or mental infirmity, or (ii) any period of Disability that is prior to the
Employee's termination of employment pursuant to this Section 9(b); provided
that any benefits paid pursuant to the Bank's long-term disability plan will
continue as provided in such plan.
(c) For Just Cause. The Board may, by written notice to the Employee,
immediately terminate his employment at any time, for Just Cause. The Employee
shall have no right to receive compensation or other benefits for any period
after termination for Just Cause. Termination for "Just Cause" shall mean
termination because of, in the good faith determination of the Board, 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 final cease-and-desist order, or material
breach of any provision of this Agreement. Notwithstanding the foregoing, the
Employee shall not be deemed to have been terminated for Just Cause unless there
shall have been delivered to the Employee a copy of a resolution duly adopted by
the affirmative vote of not less than a majority of the entire membership of the
Board (excluding the Employee if a member of the Board) at a meeting of the
Board called and held for the purpose (after reasonable notice to the Employee
and an opportunity for the Employee to be heard before the Board), finding that
in the good faith opinion of the Board the Employee was guilty of conduct set
forth above in the second sentence of this Subsection (c) and specifying the
particulars thereof in detail.
(d) Without Just Cause. The Board may, by written notice to the Employee,
immediately terminate his employment at any time for any reason; provided that,
if such termination is for any reason other than pursuant to Sections 9(a), (b)
or (c) above, the Employee shall be entitled to receive the salary provided
pursuant to Section 2 hereof, up to the date of expiration of the term
(including any renewal term then in effect) of this Agreement. Said sum shall be
paid, at the option of the Employee, either (1) in periodic payments over the
remaining term of this Agreement, as if the Employee's employment had not
terminated, or (2) in one lump sum within 10 days of such termination.
(e) Termination or Suspension Under Federal Law.
(1) If the Employee is removed and/or permanently prohibited from
participating in the conduct of the Bank's affairs by an order issued under
Sections 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act ("FDIA") (12
U.S.C. ss.1818(e)(4) or (g)(1)), all obligations of the Bank under this
Agreement shall terminate, as of the effective date of the order, but vested
rights of the parties shall not be affected.
(2) If the Bank is in default (as defined in Section 3(x)(1) of FDIA), all
obligations under this Agreement shall terminate as of the date of default;
however, this Paragraph 9(e)(2) shall not affect the vested rights of the
parties.
(3) All obligations under this Agreement shall terminate, except to the
extent that continuation of this Agreement is necessary for the continued
operation of the Bank: (A) by the Director of the Office of Thrift Supervision
("OTS"), or his or her designee,
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at the time that the Federal Deposit Insurance 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 FDIA; or (B) by the Director of 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 problems related to operation
of the Bank or when the Bank is determined by the Director of the OTS to be in
an unsafe or unsound condition. Such action shall not affect any vested rights
of the parties.
(4) If a notice served under Section 8(e)(3) or (g)(1) of the FDIA (12
U.S.C.ss.1818(e)(3) or (g)(1)) suspends and/or temporarily prohibits the
Employee from participating in the conduct of the Bank's affairs, the Bank's
obligations under this Agreement shall be suspended as of the date of such
service unless stayed by appropriate proceedings. If the charges in the notice
are dismissed, the Bank may in its discretion (A) pay the Employee all or part
of the compensation withheld while its contract obligations were suspended, and
(B) reinstate (in whole or in part) any of its obligations that were suspended.
(5) If any of the provisions of this Paragraph 9(e) conflict with 12
C.F.R.ss.563.39(b), the latter shall prevail.
(f) Voluntary Termination by Employee. Subject to the provisions of Section
11 hereof, the Employee may voluntarily terminate employment with the Bank
during the term of this Agreement, upon at least 60 days' prior written notice
to the Board, in which case the Employee shall receive only his compensation,
vested rights and employee benefits accrued up to the date of his termination.
(g) Limitation by Section 18(k) of the FDIA. Notwithstanding anything
herein to the contrary, any payments made to the Employee pursuant to this
Agreement, or otherwise, are subject to and conditioned upon their compliance
with Section 18(k) of the FDIA (12 U.S.C. ss. 1828(k)) and any regulations
promulgated thereunder.
10. No Mitigation. The Employee shall not be required to mitigate the
amount of any payment provided for in this Agreement by seeking other employment
or otherwise, and no such payment shall be offset or reduced by the amount of
any compensation or benefits provided to the Employee in any subsequent
employment.
11. Successors and Assigns.
(a) This Agreement shall inure to the benefit of and be binding upon any
corporate or other successor of the Bank that shall acquire, directly or
indirectly, by merger, consolidation, purchase or otherwise, all or
substantially all of the assets or stock of the corporation.
(b) Since the Bank is contracting for the unique and personal skills of the
Employee, the Employee shall be precluded from assigning or delegating his
rights or duties hereunder without first obtaining the written consent of the
Bank.
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12. Amendments. No amendments or additions to this Agreement shall be
binding unless made in writing and signed by all of the parties, except as
herein otherwise specifically provided.
13. Applicable Law. This Agreement shall be governed in all respects,
whether as to its validity, construction, capacity, performance or otherwise, by
the laws of the Commonwealth of Kentucky, except to the extent that Federal law
shall be deemed to apply.
14. Severability. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof
15. Entire Agreement. This Agreement, together with any understanding or
modifications thereof as agreed to in writing by the parties, shall constitute
the entire agreement between the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first above written.
ATTEST: HOPKINSVILLE FEDERAL SAVINGS BANK
________________________ By:/s/ John E. Peck
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Secretary John E. Peck, President and
Chief Executive Officer
WITNESS:
________________________ By: /s/ Michael L. Woolfolk
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Michael L. Woolfolk
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