ITEM 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers; Compensatory Arrangements of Certain Officers
| (e) | Compensatory Arrangements of Certain Officers |
On September 13, 2023, Catalyst Bank (the “Bank”), the wholly owned subsidiary of Catalyst Bancorp, Inc. (the “Company”), entered into employment agreements (the “Employment Agreements”) with Amanda B. Quebedeaux, Director of Operations, and Jacques L. J. Bourque, Chief Financial Officer (the “Executives”). The term of the Employment Agreements commence on September 13, 2023, and will expire on September 12, 2026, unless renewed or extended. Any such renewal or extension of the Employment Agreements will be reflected in an amendment or supplement to such agreement.
Prior to the expiration of the term of the Employment Agreements, the Board of Directors will review the agreements to determine whether to extend the term of the Employment Agreements for three additional years or such other time period mutually agreed upon.
Pursuant to Mrs. Quebedeaux’s employment agreement, Mrs. Quebedeaux agrees to continue her service as Director of Operations of the Bank for a term of three years ending September 12, 2026. Mrs. Quebedeaux’s agreement provides for a base salary of $147,000, which may be increased at the discretion of the Board of Directors of Catalyst Bank.
Pursuant to Mr. Bourque’s employment agreement, Mr. Bourque agrees to continue his service as Chief Financial Officer of the Bank for a term of three years ending September 12, 2026. Mr. Bourque’s agreement provides for a base salary of $95,000, which may be increased at the discretion of the Board of Directors of Catalyst Bank.
The Employment Agreements are terminable with or without cause by Catalyst Bank. The Executives have no right to compensation or other benefits pursuant to their respective employment agreements for any period after termination for cause, except for benefits that have vested and been earned prior to termination. The Employment Agreements provide that in the event of an involuntary termination of employment (including a voluntary termination by the Executive as a result of a material breach of the agreement by Catalyst Bank or for “good reason”, including a change in the Executive’s position, salary or duties without his or her consent), the Executive would be entitled to (1) a lump sum cash severance payment which is equal to twelve months of the Executive’s base salary as of the date of termination, subject to the Executive executing a release of any claims against Catalyst Bank or its affiliates and (2) continued health insurance coverage until the earlier of twelve months or the date the Executive receives substantially similar benefits from another employer.
The Employment Agreements provide that if the Executive’s employment terminates without cause or with good reason on the effective date of a change in control, as defined in the agreement, or within 30 calendar days after a change in control, then the Executive would be entitled to (1) a lump sum cash severance payment equal to 12 months of the greater of the Executive’s base salary at the time of the change in control or the date of his or her termination and (2) continued health insurance coverage until the earlier of 12 months or the date the Executive receives substantially similar benefits from another employer. If the Employment Agreements terminate as a result of the Executive’s death, the Executive’s estate or beneficiary will be paid the Executive’s base salary for twelve weeks and continued health coverage for his or her family over the same period.
