Item 8.01 Other Events.
As previously disclosed, VWF Bancorp, Inc. (the "Company") and its wholly-owned
subsidiary, Van Wert Federal Savings Bank (the "Bank"), have been conducting a
search for a qualified candidate to serve as the new President and Chief
Executive Officer of the Company and the Bank. The Company and the Bank expect
to appoint Michael D. Cahill to serve as their new President and Chief Executive
Officer. Mr. Cahill will initially serve as a consultant to the Bank, and the
Company and the Bank expect to formally appoint him to serve as President and
Chief Executive Officer of the Company and the Bank effective as of January 1,
2023. The Company and the Bank also expect to appoint him to the boards of
directors of the Company and the Bank effective as of January 1, 2023.
Mr. Cahill, age 62 and a certified public accountant, has extensive experience
in the financial services industry, and related industries, including having
served as past President and Chief Executive Officer of the former Tower
Financial Corporation and its bank subsidiary, Tower Bank and Trust Company, Ft.
Wayne, Indiana. He also served as a board member and Vice Chairman of Centier
Bank, Whiting, Indiana, and as a board member of the Indiana Bankers
Association. He serves on the faculty of the Graduate School of Banking at
Colorado.
On September 30, 2022, the Bank and Mr. Cahill entered into a consulting
agreement with respect to his consulting services and an employment agreement
with respect to his expected appointment to serve as President and Chief
Executive Officer.
Consulting Agreement
Pursuant to the terms of the consulting agreement, Mr. Cahill will provide
certain consulting services to the Bank from October 1, 2022, through December
31, 2022. He will receive $15,000 per month for his consulting services.
Employment Agreement
The employment agreement will become effective as of January 1, 2023, subject to
the formal appointment of Mr. Cahill to serve as President and Chief Executive
Officer by the boards of directors of the Company and the Bank. The employment
agreement will have an initial term of three years. Commencing as of the first
anniversary of the effective date of the employment agreement and continuing as
of each subsequent anniversary of that date, the term of the employment
agreement will extend for an additional year, so that the term again become
three years. However, at least 30 days before the anniversary of the renewal
date of the employment agreement, the disinterested members of the board of
directors must conduct a comprehensive performance evaluation of Mr. Cahill and
affirmatively approve any extension of the employment agreement for an
additional year or determine not to extend the term of the employment
agreement. If the board of directors determines not to extend the term, it must
notify Mr. Cahill before the applicable anniversary date and the term of the
employment agreement will expire at the end of the then current term. If a
change in control occurs during the term of the employment agreement, the term
of the employment agreement will automatically renew for two years from the
effective date of the change in control.
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The employment agreement provides that Mr. Cahill will receive an annual salary
of $185,000 for 2023, $200,000 for 2024 and $215,000 for 2025. Thereafter, the
board of directors will review the base salary at least annually and it may be
increased, but not decreased. In addition to receiving a base salary, Mr.
Cahill will participate in any bonus programs and benefit plans made available
to senior management employees of the Bank. He will also be reimbursed for all
reasonable business expenses incurred in performing his duties, as well for a
county club membership. He will also be provided with a company-owned or leased
automobile.
If Mr. Cahill voluntarily terminates employment, he will be entitled to receive
the sum of his (i) unpaid salary, (ii) unpaid expense reimbursements, (iii)
unused accrued paid time-off, and (iv) earned but unpaid incentive compensation
(collectively, the "Accrued Obligations").
In the event Mr. Cahill's employment involuntary terminates for reasons other
than cause, disability or death, or in the event of his resignation for "good
reason," in either event other than in connection with a change in control, he
will receive a severance payment, paid in a lump sum, equal to the Accrued
Obligations plus the base salary and bonuses (based on the highest annual bonus
earned during the three most recent calendar years before the date of
termination) he would have received during the remaining term of the employment
agreement. In addition, if he elects COBRA coverage, he will be reimbursed for
his monthly COBRA premium payments for up to 18 months.
In the event Mr. Cahill's employment involuntary terminates for reasons other
than cause, disability or death, or in the event of his resignation for "good
reason," in either event within 24 months following a change in control, he will
receive a severance payment, paid in a single lump sum, equal to his Accrued
Obligations plus three times the sum of (i) his base salary in effect as of the
date of termination or immediately before the change in control, whichever is
higher, and (ii) his highest annual cash bonus earned for the year in which the
change in control occurs or any of the three prior calendar years. In addition,
if he elects COBRA coverage, he will be reimbursed for his monthly COBRA premium
payments for up to 18 months.
For purposes of the employment agreement, "good reason" is defined as (i) a
material reduction in Mr. Cahill's authority, duties, or responsibilities, (ii)
a reduction in his salary or incentive compensation opportunities, (iii) a
relocation of his principal place of employment by more than 35 miles from the
Bank's office location or his home office, or (iv) a material breach of the
employment agreement by the Bank.
Should Mr. Cahill become disabled during the term of the employment agreement,
he will be entitled to the Accrued Obligations plus disability benefits, if any,
provided under a long-term disability plan sponsored by the Bank. If he dies
while employed by the Bank, his beneficiaries will receive the Accrued
Obligations plus any benefit payable under the life insurance program sponsored
by the Bank.
Upon a termination of employment (other than a termination in connection with a
change in control), Mr. Cahill will be required to adhere to one-year
non-competition and non-solicitation restrictions set forth in the employment
agreement.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
10.1 Consulting Agreement with Michael D. Cahill
10.2 Employment Agreement with Michael D. Cahill
104 Cover Page Interactive Data File (Embedded within Inline XBRL document)
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